The Impact of Environmental Tax on Greenhouse Gas Emissions in Visegrad Group Countries
The role of environmental tax as an economic instrument to reduce environmental degradation has been under investigation for many years. In this paper, the main research objective is to check whether there were long-term relationships (cointegration) between greenhouse gas emissions, environmental t...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
Collegium of Economic Analysis, SGH Warsaw School of Economics
2022-03-01
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| Series: | Gospodarka Narodowa. The Polish Journal of Economics |
| Subjects: | |
| Online Access: | https://gnpje.sgh.waw.pl/Wplyw-podatku-srodowiskowego-na-emisje-gazow-cieplarnianych-w-panstwach-Grupy-Wyszehradzkiej,145537,0,2.html |
| Summary: | The role of environmental tax as an economic instrument to reduce environmental
degradation has been under investigation for many years. In this paper, the main
research objective is to check whether there were long-term relationships (cointegration)
between greenhouse gas emissions, environmental taxes and gross domestic
product in Visegrad Group countries under the inverted U-shaped Environmental
Kuznets Curve (EKC) hypothesis from 1995 to 2018. It was also checked whether
environmental tax has an impact on greenhouse gas emissions. In the first step, the
long-run relationship (cointegration) was examined by applying the Autoregressive
Distributed Lag (ARDL) bounds test. In the second step, the causal relationship
and direction were tested within the Vector Error Correction Model (VECM)
framework. The results of ARDL bounds testing confirmed cointegration between variables only in Poland. However, the long-run relationships between the variables
are not consistent with the inverted U-shaped EKC hypothesis. They confirm the
U-shaped EKC hypothesis, indicating that greenhouse gas emissions decrease with
an increase in GDP per capita. After reaching the minimum, emissions increase
again. The test of the causal relationship in Poland indicates the existence of convergence
to the long-term equilibrium only for the equation where the environmental
tax is the dependent variable. |
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| ISSN: | 0867-0005 2300-5238 |