The Misinterpretation of Pigouvian Taxes ()
ABSTRACT
The tax revenues from
Pigouvian taxes are difficult to calculate. The optimal pollution taxes are
weighted averages of Ramsey taxes and Pigouvian taxes, and the entanglement of
environmental, fiscal and other taxes complicate the measurements. The present
international environmental tax statistics do not rely on a theoretical basis,
and include several fiscal and resource taxes. Starting with the additivity
theorem by Sandmo [1], we propose theoretically consistent guidelines for
environmental tax statistics. Calculations based on this framework prove that
the present international official statistics (Eurostat, IEA, OECD) severely
overestimate environmental taxes. The lack of theoretical consistency forms
arbitrary results and the statistics used as measures of environmental taxes
may cause major flaws in research and policy-making based on such statistics.
Share and Cite:
Bruvoll, A. (2013) The Misinterpretation of Pigouvian Taxes.
Journal of Environmental Protection,
4, 154-160. doi:
10.4236/jep.2013.48A1017.