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The Benefits of Environmental Fiscal Reforms in an Integrated Europe
Author(s) -
Carraro Carlo,
Galeotti Marzio
Publication year - 1997
Publication title -
review of international economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.513
H-Index - 58
eISSN - 1467-9396
pISSN - 0965-7576
DOI - 10.1111/1467-9396.5.4s.7
Subject(s) - economics , harmonization , revenue , order (exchange) , environmental tax , tax reform , differential (mechanical device) , tax revenue , macroeconomics , international economics , public economics , finance , physics , acoustics , engineering , aerospace engineering
This paper analyses the effects of an environmental fiscal reform where the environmental tax revenue is used to reduce the tax burden on labor in order to increase employment. The study tries to assess the benefits generated by this type of reform in an integrated Europe where different degrees of tax harmonization can be achieved. The differential impact of cooperative fiscal reforms versus noncooperative ones is quantified through the use of a newly developed general equilibrium model. The results suggest that only a high degree of harmonization, in which both revenue and expenditure policies are coordinated, can provide significant environmental and employment benefits.