Optimal Taxation in the Macroeconomics of Climate Change

Posted: 12 Oct 2015

See all articles by Gustav Engstrom

Gustav Engstrom

The Beijer Institute of Ecological Economics

Johan Gars

The Royal Swedish Academy of Sciences - Beijer International Institute of Ecological Economics

Date Written: October 2015

Abstract

Climate change has in recent years moved to the forefront of the policy scene. At the same time, the research literature on macroeconomic aspects of climate change has grown and broadened significantly. In this review, we survey and discuss this literature, with special attention given to results that help shed light on important qualitative questions regarding how an optimal carbon tax should be set. The review covers topics such as spatial aspects of optimal taxes, interactions with other taxes, uncertainty, technological change, and the qualitative time profile of the optimal tax.

Suggested Citation

Engstrom, Gustav and Gars, Johan, Optimal Taxation in the Macroeconomics of Climate Change (October 2015). Annual Review of Resource Economics, Vol. 7, Issue 1, pp. 127-150, 2015, Available at SSRN: https://ssrn.com/abstract=2672265 or http://dx.doi.org/10.1146/annurev-resource-100814-124951

Gustav Engstrom (Contact Author)

The Beijer Institute of Ecological Economics ( email )

Stockholm, SE-104 05
Sweden

Johan Gars

The Royal Swedish Academy of Sciences - Beijer International Institute of Ecological Economics ( email )

The Royal Swedish Academy of Sciences
P.O. Box 50005
S-104 05 Stockholm, SE-104 05
United States

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