The Pigou Problem

6 Pages Posted: 22 Aug 2008

See all articles by John V. Nye

John V. Nye

George Mason University - Department of Economics; National Research University Higher School of Economics

Date Written: August, 20 2008

Abstract

This article calls into question the Pigovian justifications for higher taxes on goods and services that generate negative externalities. Insisting on a Pigovian tax as a precautionary measure only makes sense if it replaces all preexisting subsidies, taxes, and regulations rather than being added on top of existing arrangements. The relevant issue is whether the activities causing the externality are at their socially optimal level.

Keywords: Pigovian tax, Pigou, taxation, tax, externalities, externality, transfers, regulation, global warming, pollution, gasoline, coase,

JEL Classification: D00, D6, D62, H00, H2, H20, H21, H23

Suggested Citation

Nye, John V. C., The Pigou Problem (August, 20 2008). Regulation, Vol. 31, No. 2, Summer 2008. Available at SSRN: https://ssrn.com/abstract=1241542

John V. C. Nye (Contact Author)

George Mason University - Department of Economics ( email )

4400 University Drive
Fairfax, VA 22030
United States
703-993-4272 (Phone)

National Research University Higher School of Economics

Myasnitskaya street, 20
Moscow, Moscow 119017
Russia

Register to save articles to
your library

Register

Paper statistics

Downloads
546
Abstract Views
2,683
rank
49,964
PlumX Metrics