Template-Type:ReDIF-Paper 1.0  
Title: Distortionary Taxes Preserve the Environment
Author-Name: Gaube, Thomas
Abstract: Recently, it became customary to argue that environmental 
     quality - like ordinary public consumption - is crowded out by 
     distortionary taxation. We show that this hypothesis does not hold
     provided that the marginal revenue of the environmental tax is 
     positive. In this case, under-provision of public goods implies
     over-provision of environmental quality in second best. 
     Hence, contrary to the impression left by the recent literature,
     distortionary taxes may actually provide more room for environmental 
     protection than lump-sum taxes.
Keywords: environmental taxation, public goods
Classification-JEL: H41, H21
Length: pages
Creation-Date: 1998-08
Revision-Date: 
Handle: RePEc:bon:bonsfa:579