Green Taxation and Individual Responsibility

Jerome Ballet, Damien Bazin, Abraham Lioui () and David Touahri ()
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David Touahri: Laboratoire d'Economie et de Sociologie du Travail, Université de la Méditerranée Aix-Marseille II

No 49, CAE Working Papers from Aix-Marseille Université, CERGAM

Abstract: The current article aims at studying the e¤ects of taxation on environ- mental quality, in an economy where its agents are responsible. Individual responsibility towards nature is modelized by the voluntary effort to which the households have agreed insofar as the improvement of environmental quality is concerned. Given that such effort is taken from one's allocated time for leisure, its opportunity cost is that of the sacrificed time for leisure, and is therefore equal to the individual's wage. We shall highlight that State intervention through the introduction of a (green) tax always crowds out indi- vidual responsibility. However, the intensity of this crowding-out depends on the performance of the State. Moreover, State intervention could, depending on the amount of crowding-out, reduce the overall quality of the environment. In a general equilibrium setting, we show that the crowding-out e¤ect is not systematic. This is because there will then be an interaction between e¤ort (or work time) and the cost of that e¤ort (linked to the individual's wage, and therefore to production and finally to work/effort). In this article, we shall discuss the conditions under which public policy crowds out individual responsibility within this context.

Keywords: Crowding-out effect; social responsibility; taxation (search for similar items in EconPapers)
JEL-codes: H21 H32 H41 (search for similar items in EconPapers)
Pages: 23 pages
Date: 2006
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http://junon.u-3mrs.fr/afa10w21/RePEc/cgm/wpaper/DR_49_0607_bazin.pdf Revised version, 2006 (application/pdf)
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Related works:
Journal Article: Green taxation and individual responsibility (2007)
Working Paper: Green taxation and individual responsibility (2007)
Working Paper: Green Taxation and Individual Responsibility (2007)
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