The distributional effects of a carbon tax: The role of income inequality

Working paper by Julius Andersson, Giles Atkinson on 9 Sep 2020

The fact that a carbon tax is an environmentally and economically efficient instrument for reducing emissions is often highlighted, but the equity story is also of importance. This paper addresses the question of the distributional burden of a carbon tax across different income groups and the role played by income inequality.

Distributional impacts of a carbon tax in the UK

Policy publication by Josh Burke, Sam Fankhauser, Alex Kazaglis, Louise Kessler, Naina Khandelwal, Peter O’Boyle on 9 Mar 2020

This study explores the distributional impacts of a net-zero-consistent carbon price across different household types and income deciles in the UK; and examines which combination of interventions may reduce carbon consumption and still be progressive.

The global consumer incidence of carbon pricing: evidence from trade

Working paper by Lutz Sager on 4 Apr 2019

This paper estimates the global distribution of the costs to consumers from carbon pricing, finding that some policies may be considered regressive for their burden on poorer consumers – but that the benefits from mitigating climate change may weaken or reverse the regressive effect. read more »