Arbeitspapier

The Effectiveness of Taxation and Feed-in Tariffs

We study (energy) markets with dirty incumbents and costly entry by clean producers. For intermediate entry costs, the market outcome exhibits inefficient production and inefficient entry. A policy mix of three popular regulatory instruments—taxation on polluters, feed-in tariffs for clean entrants, and taxation of consumption—cannot correct these two market failures. Feed-in tariffs and consumption taxes are ineffective instruments for implementing the first best. The second best requires feed-in tariffs or consumption taxes. For a given level of production, the instruments are ineffective in influencing the overall budget, but may be effective for other budgetary concepts.

Sprache
Englisch

Erschienen in
Series: CESifo Working Paper ; No. 4788

Klassifikation
Wirtschaft
Firm Behavior: Theory
Allocative Efficiency; Cost-Benefit Analysis
Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies
Thema
taxation
feed-in tariffs
externalities
entry
pollution

Ereignis
Geistige Schöpfung
(wer)
Antoniou, Fabio
Strausz, Roland
Ereignis
Veröffentlichung
(wer)
Center for Economic Studies and ifo Institute (CESifo)
(wo)
Munich
(wann)
2014

Handle
Letzte Aktualisierung
10.03.2025, 11:42 MEZ

Datenpartner

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Objekttyp

  • Arbeitspapier

Beteiligte

  • Antoniou, Fabio
  • Strausz, Roland
  • Center for Economic Studies and ifo Institute (CESifo)

Entstanden

  • 2014

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