The Impact of Information Provision on Public Acceptance of Carbon Tax Revenue Recycling: A Randomized Experiment in Germany

Abstract

Past research has shown that earmarking carbon tax revenues for green investments is more popular than lump-sum repayments. This suggests a limited understanding of the carbon price mechanism. This study uses a randomized controlled trial with a sample of the general population in Germany (N = 4,040) to investigate whether providing information about the underlying mechanism can increase support for lump-sum repayments and other revenue recycling schemes besides green spending.