Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/101739
Authors: 
Hettich, Frank
Year of Publication: 
1997
Series/Report no.: 
Diskussionsbeiträge: Serie II, Sonderforschungsbereich 178 "Internationalisierung der Wirtschaft", Universität Konstanz 351
Abstract: 
This paper analyses tax policy measures within a two sector endogenously growing economy with elastic labour supply. Pollution is modelled as a side product of physical capital stock used as a primary production factor in the final good sector. The framework allows to analyse consequences of isolated tax changes or of a revenue neutral environmental tax reform for economic growth. Although pollution does not affect directly production processes, it can be shown that a higher pollution tax or a revenue neutral environmental tax reform boosts economic growth, whereas a tax on capital, consumption or labour reduces the long term growth rate of the economy.
Subjects: 
Endogenous growth
environmental externalities
environmental tax reform
elastic labour supply
optimal taxation
JEL: 
E62
Q28
O41
D62
Document Type: 
Working Paper

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