Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/208195
Authors: 
Vogt-Schilb, Adrien
Walsh, Brian
Feng, Kuishuang
Di Capua, Laura
Liu, Yu
Zuluaga, Daniela
Robles, Marcos
Hubaceck, Klaus
Year of Publication: 
2019
Series/Report no.: 
IDB Working Paper Series No. IDB-WP-1046
Abstract: 
Carbon taxes are advocated as efficient fiscal and environmental policies, but they have proven difficult to implement. One reason is that carbon taxes can aggravate poverty by increasing prices of basic goods and services such as food, heating, and commuting. Meanwhile, cash transfer programs have been established as some of the most efficient poverty-reducing policies used in developing countries. Here, we quantify how governments can mitigate negative social consequences of carbon taxes by expanding the beneficiary base or the amounts disbursed with existing cash transfer programs. We focus on Latin America and the Caribbean, a region that has pioneered cash transfer programs, which aspires to contribute to climate mitigation, and faces inequality. We find that 30% of carbon revenues could suffice to compensate poor and vulnerable households on average, leaving 70% to fund other political priorities. We also quantify tradeoffs for governments choosing who and how much to compensate.
Subjects: 
cash transfers
carbon taxes
climate change
JEL: 
H22
H23
Q54
Q01
N56
013
Persistent Identifier of the first edition: 
Creative Commons License: 
https://creativecommons.org/licenses/by-nc-nd/3.0/igo/legalcode
Document Type: 
Working Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.