ArticlePDF Available

Abstract and Figures

Turning the Paris Agreement’s greenhouse gas emissions pledges into domestic policies is the next challenge for governments. We address the question of the acceptability of cost-effective climate policy in a real-voting setting. First, we analyze voting behavior in a large ballot on energy taxes, rejected in Switzerland in 2015 by more than 2 million people. Energy taxes were aimed at completely replacing the current value-added tax. We examine the determinants of voting and find that distributional and competitiveness concerns reduced the acceptability of energy taxes, along with the perception of ineffectiveness. Most people would have preferred tax revenues to be allocated for environmental purposes. Second, at the same time of the ballot, we tested the acceptability of alternative designs of a carbon tax with a choice experiment survey on a representative sample of the Swiss population. Survey respondents are informed about environmental, distributional and competitiveness effects of each carbon tax design. These impacts are estimated with a computable general equilibrium model. This original setting generates a series of novel results. Providing information on the expected environmental effectiveness of carbon taxes reduces the demand for environmental earmarking. Making distributional effects salient generates an important demand for progressive designs, e.g. social cushioning or recycling via lump-sum transfers. The case of lump-sum recycling is particularly striking: it is sufficient to show its desirable distributional properties to make it one of the most preferred designs, which corresponds to a completely novel result in the literature. We show that providing detailed information on the functioning of environmental taxes may contribute to close both the gap between acceptability ex ante and ex post and the gap between economists’ prescriptions and the preferences of the general public.
This content is subject to copyright. Terms and conditions apply.
Environ Resource Econ (2017) 68:97–128
DOI 10.1007/s10640-017-0133-8
Green Taxes in a Post-Paris World: Are Millions of Nays
Stefano Carattini1,2·Andrea Baranzini3·Philippe Thalmann4·
Frédéric Varone5·Frank Vöhringer4
Accepted: 7 March 2017 / Published online: 23 March 2017
© The Author(s) 2017. This article is an open access publication
Abstract Turning the Paris Agreement’s greenhouse gas emissions pledges into domestic
policies is the next challenge for governments. We address the question of the acceptability
of cost-effective climate policy in a real-voting setting. First, we analyze voting behavior in
a large ballot on energy taxes, rejected in Switzerland in 2015 by more than 2 million people.
Energy taxes were aimed at completely replacing the current value-added tax. We examine
the determinants of voting and find that distributional and competitiveness concerns reduced
the acceptability of energy taxes, along with the perception of ineffectiveness. Most people
would have preferred tax revenues to be allocated for environmental purposes. Second, at
the same time of the ballot, we tested the acceptability of alternative designs of a carbon tax
with a choice experiment survey on a representative sample of the Swiss population. Survey
respondents are informed about environmental, distributional and competitiveness effects of
each carbon tax design. These impacts are estimated with a computable general equilibrium
model. This original setting generates a series of novel results. Providing information on the
The authors thank Sam Fankhauser, Anthony Leiserowitz and Boris Krey as well as the editors of this
special issue, Cees Withagen, Gerard van der Meijden, and Rick van der Ploeg, for providing very valuable
feedback. All authors acknowledge financial support from the Swiss Federal Office of Energy. Carattini
acknowledges support from COST Action IS1309 “Innovations in Climate Governance: Sources, Patterns
and Effects” (INOGOV) and from the Swiss National Science Foundation, grant P2SKP1_165028.
BStefano Carattini
1Yale School of Forestry and Environmental Studies, Yale University, New Haven, CT, USA
2Grantham Research Institute on Climate Change and the Environment and ESRC Centre for Climate
Change Economics and Policy, London School of Economics and Political Science, London, UK
3Haute école de gestion de Genève, HES-SO/University of Applied Sciences Western Switzerland,
Carouge, Switzerland
4Swiss Federal Institute of Technology Lausanne - Ecole Polytechnique Fédérale de Lausanne
(EPFL), Lausanne, Switzerland
5Department of Political Science and International Relations, University of Geneva,
Geneva, Switzerland
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
98 S. Carattini et al.
expected environmental effectiveness of carbon taxes reduces the demand for environmental
earmarking. Making distributional effects salient generates an important demand for progres-
sive designs, e.g. social cushioning or recycling via lump-sum transfers. The case of lump-sum
recycling is particularly striking: it is sufficient to show its desirable distributional properties
to make it one of the most preferred designs, which corresponds to a completely novel result
in the literature. We show that providing detailed information on the functioning of environ-
mental taxes may contribute to close both the gap between acceptability ex ante and ex post
and the gap between economists’ prescriptions and the preferences of the general public.
Keywords Carbon taxes ·Acceptability ·Political economy ·Ballot data ·Choice
JEL Classification: D72 ·D78 ·H23 ·Q54
1 Introduction
During the last decades, countries and international organizations have struggled to define a
system of global governance able to tackle climate change. The Kyoto Protocol spurred the
adoption of a first generation of climate policies (Fankhauser et al. 2015), but much more
effort is required to meet the challenge of climate change mitigation (IPCC 2014). Unilateral
policies have emerged to partly compensate for the continued failure of international nego-
tiations (Ostrom 2009;Jordan et al. 2015), but only a fraction of countries opted for energy
and carbon taxes (Baranzini and Carattini 2014;World Bank 2014). Most countries went for
“soft policies” such as subsidies for renewable energies, which in some cases turned up to
be not only strongly regressive but also extremely expensive (Marcantonini and Ellerman
2014). Vested interests and the general unpopularity of taxes are the main reasons behind
this political choice.
The developments related with the 2015 Conference of Parties to the United Nations
Framework Convention on Climate Change and the Paris Agreement have created a major
breakthrough in the international negotiations for climate change mitigation. However, coun-
tries’ emissions pledges are not credible policy commitments. The world is at a turning point:
strong domestic policies are now necessary to meet the Paris pledges at a reasonable cost. Any
other outcome is likely to put the pledge-and-review system under pressure and to jeopardize
the future tightening of current pledges (Baranzini et al. 2015).
How to overcome resistance to energy and carbon taxes is thus of primary interest. A
recent literature has attempted to provide a first set of explanations to the lack of public
support for environmental taxes. Real ballots on environmental taxes take place sporadically,
and so real voting behavior is hard to observe. As a result, the existing literature generally
relies on primary data from stated preference surveys, and revealed preference studies in
controlled settings. These studies are usually realized in neutral times, i.e. absent any political
campaigning. However, vested interests and media coverage are very powerful drivers of
public opinion on environmental matters (Sampei and Aoyagi-Usui 2009;Jacobsen 2011;
Spash and Lo 2012).
On March 8, 2015 the Swiss population was called to vote on a popular initiative aiming
at replacing the current value-added tax (VAT) with an energy tax. About 2.2 million voters
expressed their opinion. The proposal was rejected by a large majority, 92% of voters. Right
after the ballot, a survey was administered to a representative sample of the Swiss popula-
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
Green Taxes in a Post-Paris World: Are Millions of Nays... 99
tion, to explain the observed voting behavior. This strategy allows us to compare our sample
with the observed outcome and obtain information on the extent of misreporting, if any. At
the same time, we administered a choice experiment to another representative sample of the
Swiss population, taking advantage from the very specific timing to assess the acceptability
of alternative tax designs in presence of high political salience. In using this real context, we
build on a common finding in the stated preference literature, which suggests that respondents
with experience with a given type of decision tend to provide more reliable answers. In this
case, our sample has prior experience with the voting system in Switzerland, and the specific
timing of the survey implies that they can also have experience on climate policy issues. In
the choice-experiment setting we consider a carbon tax with four different tax rates and five
revenue recycling options: income tax rebates; reduction of the value-added tax; lump-sum
transfers; social cushioning; and earmarking for additional emission abatements through the
purchase of international carbon offsets. Respondents face three alternatives: two different
carbon tax designs, and the status quo. Hence, we reproduce the situation of real ballots, in
which voters are asked to express their opinion on different proposals, with of course the
possibility to reject all of them (see Kriesi 2005). We exploit the results of a general equi-
librium modeling exercise to inform respondents on the expected outcomes of each carbon
tax design in terms of energy price increases, emission abatements, overall economic effects
and distributional impacts. In this way, we address some of the most recurrent obstacles to
the popularity of carbon taxes, all of which are arguably driven by imperfect information:
excessive fear of adverse competitiveness and distributional effects, perceived environmental
ineffectiveness and misunderstanding of revenue neutrality. Our novel approach uses a large
sample of representative individuals, while providing detailed information on the functioning
of carbon taxes, and transparent figures on the consequences that each decision would have.
Our approach thus aims at combining the benefits of surveys and experiments. The contri-
bution of both methods has been substantial in this literature, and we build on the lessons
learnt with both. To the best of our knowledge, this is the first time such a methodological
approach is used.
Our study is of interest for all democratic settings, direct or indirect. We use Switzerland
as a laboratory of study, but the divergence between economists and the general public on
the benefits of environmental taxes is a recurring obstacle to environmental tax reforms all
around Europe (Dresner et al. 2006). The unpopularity of carbon taxes has hampered their
implementation in France (Deroubaix and Lévèque 2006), while fear of competitiveness
effects led to massive exemptions in Scandinavian countries, decreasing the potential for
any sizeable environmental effect (Baranzini and Carattini 2014). Similar obstacles seem to
reduce the popularity of carbon taxes in emerging economies, too (Gevrek and Uyduranoglu
2015). Recent voting in the United States (Washington State) provides further support to the
idea of a widespread resistance to carbon taxes.
Data on voting behavior shows that the chances of the 2015 popular initiative rejected in
Switzerland would have been much higher if tax revenues had been earmarked for environ-
mental purposes rather than for replacing the VAT, everything else equal. Concerns about the
effect of higher energy prices on the distribution of income as well as on the competitiveness
of firms are among the main determinants of rejection. People are also generally skeptic
about the potential change in behavior that energy taxes could generate.
The design of our choice experiment addresses all these concerns and shows that infor-
mation provision can lead to very different results from those in the literature. Estimations
from our modeling scenarios suggest that all carbon tax designs under investigation imply
limited competitiveness effects and all provide significant reductions in emissions. Using the
full tax revenues to purchase foreign offsets allow for massive emission abatements. Most
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
100 S. Carattini et al.
recycling options imply slightly regressive effects, except for lump-sum transfers and social
cushioning, which (the latter by design) lead to a net progressive effect.
A common finding in the literature is that people are most willing to accept a carbon tax
if its revenues are used to strengthen its environmental effectiveness, which people believe
to be small. This stylized fact is confirmed by our analysis of voting behavior. However,
our choice-experiment setting, by informing on the emissions reduction associated with the
different carbon taxes, allows closing the gap between (possibly low) perceived effectiveness
and (higher) predicted effectiveness. As a result, we find that earmarking for additional
abatements is no longer particularly attractive. Information on the scenarios’ predictions
renders instead lump-sum transfers and social cushioning particularly popular, by making
salient their progressive properties. The finding for lump-sum transfers is particularly striking.
Despite their minimal administrative burden and the ability to address distributional concerns
(Baranzini et al. 2000;Metcalf 2009), lump-sum transfers are especially neglected by the
literature on the acceptability of carbon taxes. The reason for this is that these properties may
not be perceived by the population, along with revenue neutrality. Our setting shows however
that it is sufficient to provide people with some supplementary information to reduce the gap
between their preferences and economists’ prescriptions.
We find that recycling through income tax rebates is relatively unpopular, as often found
in the literature. People do not seem to understand the concept of environmental tax reform,
or at least they do not see its advantages as some economists do. We stress that our modeling
scenarios do not suggest the existence of a significant double dividend, i.e. positive economic
effects through the reduction of distortionary taxes. Reductions in the value-added tax perform
similarly poorly, in terms of acceptability. We also find that the support for green taxes
decreases linearly with the rise in the tax rate. If we use our choice experiment to simulate
the level of acceptability of the popular initiative voted on March 8, 2015, we obtain a figure
that is very consistent with the observed real outcome, indicating a high external validity of
the results based on our choice experiment.
We contribute to the literature on the acceptability of carbon taxes by shedding new
light on the obstacles to the acceptability of carbon taxes. We make the voting decision in
the choice-experimental setting as realistic as possible and provide people with sufficient
details to take an informed decision on carbon taxes. Our results show that making the
effect of environmental taxes salient can contribute to render relatively unpopular designs
much more popular. We relate this result to a recent finding in the literature suggesting that
experiencing the functioning of a given policy design allows citizens to revise their beliefs
on the effectiveness and fairness of environmental taxes, which by default tend to be overly
pessimistic (cf. e.g. Carattini et al. 2016). Our approach thus provides an alternative to the
use of trials that has been increasingly called for to remedy environmental taxes’ lack of
popularity (Sælen and Kallbekken 2011;Cherry et al. 2014;Carattini et al. 2016). With a
careful design and detailed information, acceptable carbon taxes can be implemented at a
moderately high tax rate, and sustain credible climate policies.
2 Context
2.1 Literature Review
The theoretical literature on the political economy of environmental policy mostly focuses
on lobbying by energy-intensive industries (see Oates and Portney 2003 for a review). Yet,
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
Green Taxes in a Post-Paris World: Are Millions of Nays... 101
Kirchgassner and Schneider (2003) stress the importance of considering voters’ preferences,
and how their pure economic objectives may compete with other interests, including environ-
mental preferences. The opinion of the general public may however be biased by media, and
captured by vested interests, possibly leading to inaccurate opinion formation and policy-
making (Millner and Ollivier 2016). But citizens can also organize in environmental advocacy
groups and play an active role in the political arena. The model of Marchiori et al. (2017)
shows that the presence of green lobbies influencing policy-makers may contribute to increase
the stringency of environmental policy, as well as the likelihood of a stable coalition in envi-
ronmental agreements.
The theoretical literature usually takes a narrow perspective and presumes that people
rarely vote on policies, but rather for candidates and parties. The empirical literature has
instead taken a broader perspective, assessing for instance the private willingness to pay
for climate change mitigation (see Nemet and Johnson 2010 for a review), as well as the
acceptability of specific policies. The case of environmental taxes has received particular
attention. So popular among economists for reasons of efficiency and environmental effec-
tiveness (Baranzini et al. 2015) and so unpopular among the general public, environmental
taxes represent a unique opportunity to study the consequences of informational asymmetries
between citizens, policy-makers and experts.
Empirical economists have used a wide range of tools to understand the determinants of
energy taxes’ acceptability. Qualitative assessments using focus groups have helped under-
standing the obstacles to the European Environmental Tax Reform (Dresner et al. 2006)and
to environmental taxes more generally (Kallbekken and Aasen 2010). Qualitative surveys
have also been used to orient quantitative surveys, as in Baranzini and Carattini (2017).
The focus groups of Dresner et al. (2006) revealed the high level of distrust in environ-
mental tax reforms among the general public. The general public seems to underestimate
the effectiveness of environmental taxes and to perceive them mainly as an excuse for rais-
ing additional public revenues. People may only be willing to support their introduction if
revenues are clearly earmarked for environmental purposes. They also wonder how environ-
mental taxes could green the economy if revenues were to be redistributed. Moreover, they
raise fears of adverse competitiveness and distributional effects.
These findings from small samples have been confirmed by larger surveys. Steg et al.
(2006) interviewed about one hundred respondents in the Netherlands on the perceived effec-
tiveness and acceptability of energy subsidies and taxes. They find subsidies to be much more
effective, at least in people’s eyes. “Pull measures” (i.e. subsidies) are seen as incentives driv-
ing a voluntary change in behavior, whereas taxes are felt as coercive measures imposing
a change in behavior, and thus facing people’s resistance. Taxes can however be perceived
as effective if revenues are earmarked for environmental purposes. In terms of acceptability,
instruments and designs that are perceived as effective (i.e. subsidies) overperform those that
are not (i.e. taxes). Similar results are provided in Kallbekken and Sælen (2011). Based on
a Norwegian sample, the authors find that perceived ineffectiveness of fuel taxes represents
a major obstacle to acceptability. In this respect, Baranzini and Carattini (2017)findthat
acceptability depends on the expectation of both primary and ancillary benefits. Earmarking
revenues for environmental purposes contributes to reduce the hostility to a carbon tax, as
well as renaming it “climate contribution”.
The potential of standard surveys is however limited, in particular when respondents are
required to deal with complex issues such as the design of carbon taxes. A few authors have
thus opted for choice experiments, which allow focusing on the internal validity and thus
reduce the room for bias related to hypothetical answers. Bristow et al. (2010) analyze the
acceptability of personal carbon trading schemes and carbon taxes with a sample of about 300
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
102 S. Carattini et al.
individuals. They compare different tax rates and modes of recycling and find for instance
that tax thresholds perform particularly well in terms of acceptability. Thresholds can indeed
reduce the regressive effects of carbon taxes, similarly to lump-sum recycling. While the
authors call for the use of larger samples to support their findings, they suggest that acceptable
carbon tax designs are not a chimaera. Sælen and Kallbekken (2011) show, with a choice
experiment, that the chances for carbon taxes to be acceptable are higher with earmarking
for environmental revenues. With this type of recycling, the Norwegian population would
agree to increase the current fuel tax rate by about 15%. Brannlund and Persson (2012)also
use a choice experiment to test different designs for a carbon tax. The labeling of the tax
changes randomly with the other attributes and the authors find that even labeling it “other”
is better than using its real name, “tax”. Progressive designs are also preferred to regressive
ones. Gevrek and Uyduranoglu (2015) extend the analysis of the acceptability of carbon
taxes to emerging economies with a choice experiment in Turkey. While their setting does
not allow measuring the overall level of acceptability of hypothetical Turkish carbon taxes,
their empirical exercise provides very similar findings to the literature in developed countries,
including the preference for progressive schemes, for earmarking of revenues and for low
tax rates.
Choice experiments contribute to tackle the issue of hypothetical bias. However, inference
is still based on stated preferences. Revealed preferences are elicited in lab experiments,
but issues of external validity may arise if the general public behaves differently than the
sample participating in the experiment (Harrison and List 2004). In many cases, however,
lab experiments can perform relatively well in terms of external validity, while, at the same
time, providing the advantage of a controlled environment, in which the experimenter can
create a microeconomic system that mirrors the real world, and in which the decisions that
subjects take determine their financial payoff (see Alm et al. 2015;cf.alsoFalk and Heckman
2009). Providing detailed (or “full”) information is also possible in this context, and payoffs
are generally transparent. Some examples of lab experiments are available in this literature.
For instance, Kallbekken et al. (2011) provide experimental evidence in favor of tax aversion
and of the demand for earmarking of Pigouvian tax revenues. They show that efficiency
and acceptability may conflict even when real stakes are involved, i.e. participants do not
necessarily prefer the policy that is pay-off maximizing (see also Kallbekken et al. 2010).
Labeling carbon taxes as “fee” helps to reduce tax aversion. The experiment of Cherry et al.
(2012) supports these findings and also provides support for those of Steg et al. (2006).
In particular, the authors show that “non-coercive” instruments such as subsidies (and even
quotas) are much preferred to carbon taxes, so that policy-makers betting on carbon taxes may
end up with the status quo. In the authors’ words, inefficient “half measures” are more likely
to be politically feasible than efficient “full measures”. Cherry et al. (2014) allow subjects in a
market with externalities to vote on the introduction of Pigouvian taxes, including after having
experienced the policy in a trial period. Trial periods increase the acceptability of the policy
that subjects are allowed to experiment. Tiezzi and Xiao (2016) also design a market with
an externality, but in their framework addressing this externality with a tax may not have an
immediate effect. With such intertemporal context, they show that the delay in experiencing
the benefits from taxation reduces the support for this instrument. They motivate this finding
with the complexity of the situation in which subjects have to take their decisions, doubting
the plausibility of extremely high discount rates.
These methods are generally used as imperfect substitutes for the observation of real ballots
on environmental taxes, which are unthinkable in some countries and very rare in others. A
few opportunities to study voting behavior on environmental matters already occurred in
the United States or Switzerland, even though not exclusively on environmental taxes (see
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
Green Taxes in a Post-Paris World: Are Millions of Nays... 103
Deacon and Shapiro 1975;Fischel 1979;Kahn and Matsusaka 1997;Fort and Bunn 1998;
Salka 2001;Kahn 2002;Stadelmann-Steffen 2011). An exception is Thalmann (2004), who
analyzes three energy tax proposals voted and rejected by the Swiss population in 2000.
While all proposals failed, two were really close to the majority threshold. Differences in
the use of revenues (earmarking for subsidizing renewable energy versus redistribution),
and in the tax rates, are shown to potentially contribute to the small differences in the rate
of approval between the revenue-neutral “Green tax reform” (44.6% of yes-votes) and the
“Energy conservation package” (46.6%). The third alternative, the “Solar initiative” (31.9%),
proposed to earmark half of the revenues for solar energy, and the other half for energy
conservation. Differences in the socio-economic and geographic characteristics of voters
explain within-proposal variation (Halbheer et al. 2006;Bornstein and Lanz 2008).
2.2 Local Context
On March 8, 2015, the Swiss population voted on a popular initiative launched by the Green
Liberal Party aiming at replacing the current value-added tax with a tax on non-renewable
energy.1The Swiss government and all other parties but the Green Party were against the
initiative. In spite of the initiative’s low probability of success, the business organizations
invested important efforts in a campaign emphasizing the potential drawbacks of such a
The main arguments in favor of the initiative were:
It taxes dirty energy sources, making renewable energy sources competitive without
subsidization and allowing for a transition towards a more sustainable economy
It ensures fiscal neutrality, by keeping both the revenues for the government and the
overall tax burden unchanged
It rewards environmentally-friendly consumers, by allowing them to save money on the
It strengthens the local economy by reducing its dependence on oil producer states and
by inciting green innovation in Switzerland
It saves costs to firms by eliminating the administratively burdensome VAT
The government shared in principle all these objectives, but not the mean to achieve them as
proposed by the initiative. In February 2015, Switzerland was the first country to submit a
pledge to the United Nations Framework Convention on Climate Change’s pledge-and-review
system. It pledged to reduce greenhouse gas emissions by 50% by 2030 with respect to the
levels of 1990. However, the Swiss government opposed the intention to completely erase the
VAT and replace it with an environmental tax, which is supposed to over time reduce energy
consumption, i.e. its own tax base. The government stressed that the VAT revenues represented
its main source of funding, and that a relatively high tax rate would have been necessary
to raise the same revenues of the VAT with an energy tax. During the debate, a potential
price of 5 Swiss francs (CHF) per liter of gasoline was mentioned, i.e. a trebling of current
prices. This scenario was rapidly appropriated by the political parties and organizations
opposing the initiative. The government also mentioned a series of concerns related with
the competitiveness and distributional effects of the proposed reform. The argument about
the threat to competitiveness resonated particularly strongly in that specific period, which
followed by a few weeks only the decision of the Swiss National Bank to drop its euro peg.
1The maximum rate of the VAT is 8%. On the same day, the population also voted on a popular initiative
of the Christian Democratic People’s Party of Switzerland aiming at increasing fiscal exemptions for families
with children. This initiative was rejected at 75.4%.
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
104 S. Carattini et al.
The ensuing appreciation of the Swiss franc was at the time expected to put under extreme
pressure the many export-oriented sectors of the Swiss economy.
The popular initiative was rejected at 92%. The Swiss government did not formulate a
counter-proposal, but a few weeks after the ballot announced its strategy to meet the above-
mentioned pledges as well as to phase out nuclear energy (the so-called “Energy Strategy
2050”). This strategy is still valid and consists of higher taxes on electricity and heating fuels.
Transport taxes are also expected to be taxed, but only after a period of adaptation. We note
that Switzerland introduced a carbon tax in 2008, but only on heating and process fuels. The
current tax rate is 84 CHF/tCO2.
3 Methodology
3.1 Analysis of Voting Behavior
Since 1977, the Swiss Centre of Expertise in the Social Sciences conducts the VOX survey
after each federal ballot. 1500 persons are interviewed. We use these data to assess the
determinants of voting behavior on the March 8 vote on the energy tax. VOX data are
widely used to analyze voting behavior on different matters, as they perform well in terms
of representativity and may not present in their full extent the weaknesses of pure stated-
preference studies. We took advantage of the strong presence of energy issues in the media
at the time of this ballot to administer a second survey. It uses a choice experiment format
to elicit the acceptability of alternative energy tax designs (see below). Both surveys were
carried out between March and May 2015.
In Switzerland, the rejection of a popular initiative is rather the rule, and not the exception.
From 1891 to date, 9 out of 10 popular initiatives were rejected at the ballot box (sometimes
after having influenced the legislative process). However, the rejection rate for this initiative
is the second highest since 1891, the highest since 1929. This high rejection rate implies
that voters from all government parties have contributed to reject the initiative, including the
political left. The participation rate (42%) was slightly below the average participation rate
for all popular votes during the period 1991–2014 (43.7%), the importance of the issue at
stake being relatively low compared to the average ballot, including hotter energy issues such
as nuclear phasing-out.
3.2 Choice-Experiment on Alternative Designs
3.2.1 Survey Setting
Not all designs can be subject to vote. Previous research has shown the importance of the
policy design for acceptability and it is thus crucial to have information on different policy
attributes and the combination thereof. The only way to obtain such information from a
relatively large sample—that is, larger than what is usually available in the laboratory—is to
rely on stated preferences. It is however possible to set up a survey in a way that it makes
choices and trade-offs the most realistic possible, such as with a choice experiment.
A choice experiment design allows putting the consumer, or voter, in a real-life situation
and, thus, reduces the hypothetical bias. In this case, we also leverage on the fact that our
respondents, as Swiss residents, are in general familiar with the mechanisms of direct democ-
racy, and are also familiar with the particular issue at stake, given the timing of the choice
experiment. An important literature has shown that stated preference studies tend to perform
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
Green Taxes in a Post-Paris World: Are Millions of Nays... 105
Tab le 1 Choice experiment:
attributes and levels Attributes Levels
Tax rate (CHF/tCO2)60
Revenue recycling Income tax rebates
VAT rebates
Lump-sum transfers
Social redistribution
Environmental earmarking
better, and thus be more reliable, when respondents have prior experience with the type of
decision analyzed in the study (cf. e.g. Boyle et al. 1993;Whitehead et al. 1995;Cameron
and Englin 1997;Czajkowski et al. 2015).
Furthermore, most of the focus is on the internal validity driven by the comparison of
different designs. In our choice experiment, we present all respondents with three poten-
tial choices: two carbon taxes with two different designs and the status quo. By giving to
respondents the possibility to reject all proposals, we are able to measure not only the relative
preference for a given policy attribute, but also the overall likelihood that a carbon tax can
be accepted. The design of the proposed carbon taxes is the result of the combination of two
attributes: the tax rate, measured in terms of Swiss francs per ton of CO2emitted, and the
use of the tax revenues (see Table 1). Each respondent is requested to select one of the three
options in 8 different hypothetical ballots, with the attributes being randomly combined at
each time. To increase precision in the identification of the attributes’ effects, respondents
are given one of the 15 randomly-generated versions of the questionnaire.
As all combinations included in the choice experiment were previously part of a modeling
exercise, we are able to provide respondents with information on the order of magnitude for
the expected impacts on the following items of each carbon tax design:
Price of gasoline, diesel and heating fuel
CO2emissions. When revenues are used to strengthen the environmental impact of the
policy, we assume that international offsets are purchased and we thus also estimate
the effect on carbon emissions abroad. We express this reduction in relative terms with
respect to the emissions of Switzerland
Purchasing power of the average Swiss household, based on a proxy for overall con-
Purchasing power of the average low-income household
We provide realistic numbers based on scenarios for 2020 from a dynamic multi-sectorial
multi-household general equilibrium model of the Swiss economy, called GENESwIS (see
Vöhringer 2012).2For a range of uniform carbon taxes of 60–150CHF/tCO2, the model pre-
dicts domestic emission reductions of 5–15%. Impacts on total consumption are generally
2In GENESwIS, households are disaggregated according to living standards and composition. Households
and firms act rationally under perfect foresight and competition, and the government collects taxes and uses
the revenue for public goods provision and social benefits (equal yield is assumed). Further standard features
include international trade with an Armington assumption, labor-leisure choice, and a putty-clay representa-
tion for capital. GENESwIS is based on the 2008 energy related disaggregation of the Swiss Input–Output
Tab le ( Nathani et al. 2011), combined with the population census of the Swiss Federal Statistical Office
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
106 S. Carattini et al.
negative, up to 0.5% for a tax rate of 150 CHF/tCO2combined with environmental recy-
cling. As a notable exception, a small double dividend can be found for recycling through
reductions of marginal income tax rates. Pure tax reforms with proportional rate reductions
are regressive, and income tax recycling is the most regressive of the simulated variants. In
contrast to this, lump-sum recycling renders the reform clearly progressive. International car-
bon offsets are cheap at the moment, and even very conservative assumptions allow for very
sizable additional abatement abroad when carbon tax revenues are used for purchasing offsets.
The aim of this simulation is to provide sufficient information for the most relevant vari-
ables that are supposed to guide voting behavior, replicating the effort that a government
could do to introduce environmental taxes to the population. Since we carefully explain to
respondents the functioning and effects of carbon taxes, we expect this specific setting to
lead to different results with respect to what is most often found in the literature.
The recruitment of participants went as follows. A set of about 4000 potential respondents
was randomly selected and received by post the following material:
A letter presenting the study, making all participants familiar with the issue and encour-
aging them to participate in the survey if called by phone, following the guidelines of
Harrison and List (2004)
A detailed one-page fact sheet explaining how carbon taxes work and the main implica-
tions of each recycling option
The full set of choice cards for all 8 votes displaying the attributes and related impacts
as estimated by the computable general equilibrium model (see Fig. 3for an example)
A randomly drawn sub-set of the about 4000 potential respondents was then contacted by
phone and driven through the questionnaire. In total 1200 individuals were interviewed.3
When it came to take a decision on the hypothetical ballots, all respondents were read a
short and unique text describing the effects of each carbon tax type. This ensured that all
respondents were provided with the same information, even those who had not spent time
reading the material that they had received at home. As many already “voted” at home,
respondents were given the possibility to skip the oral explanations.4
3.2.2 Preferences for Attributes of Carbon Taxes
Before identifying the determinants of individual support for a carbon tax, we hypothesize
what they could be, based on our literature review:
Footnote 2 continued
(cf. Ecoplan 2012). Core elasticities of substitution that are relevant for carbon abatement have been taken
from Mohler and Müller (2012).
3The actual response rate was however about 75%. We contacted by mail 4000 potential respondents, but
only about 1600 had to be contacted by phone to reach the quota of 1200 observations. The response rate is
thus relatively high, which helps to mitigate potential self-selection issues (see also next section). We believe
that there are three main reasons for this high response rate. First, as suggested by Harrison and List (2004),
an official invitation to participate in the study, as sent to each respondent, is likely to increase the response
rate. Second, the salience of the topic is also likely to have contributed to increase the interest in our study.
Third, the survey was administered by a marketing firm whose policy is to contact even 15 times the same
phone number, until receiving an answer, to minimize issues related with selection.
4In Switzerland, people may be asked to vote four times a year. A few weeks before the day of voting, all
potential voters receive by post written information about the ballot, so that they have the time to form their
opinion and also vote by correspondence if wishing so. Our choice experiment is thus organized in a way that
matches standard ballot procedures. We emphasize that information on proposed policies circulates widely
also in democratic countries that do not use the instruments of direct democracy, even though in different
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
Green Taxes in a Post-Paris World: Are Millions of Nays... 107
Hypothesis 1 Tax ra t e We expect higher tax rates to lead to lower acceptability for carbon
taxes, everything else equal
Hypothesis 2 Revenue recycling We expect acceptability to vary substantially depending
on the use of revenues. We expect use of revenues for environmental purposes
to increase acceptability the most, followed by social cushioning addressing
potential distributional effects. We expect lower acceptability with the other
recycling modes. Taxing here and reducing taxes elsewhere is usually a crite-
rion that the taxpayers do not request, or understand. This is particularly true
in the absence of a double dividend. We do not have specific priors on the
relative ranking among income tax rebates, VAT reductions and lump-sum
4 Empirical Results
4.1 Analysis of Voting Behavior
The VOX survey mainly consists in a standard list of questions, unchanged from ballot to
ballot, to which are added additional questions specific to each ballot (two were added on
our request). Table 2presents the main outcomes for our analysis along with other main
variables of interest (see Table 7for descriptive statistics on the characteristics of our VOX
respondents, Table 8for those of the choice-experiment sample and Table 9for those of the
underlying population). As usual, the VOX ballot performs relatively well in predicting the
ballot outcome. The frequency of no-votes in the survey, 90%, is indeed very close to the
real outcome (92%). The survey overestimates instead to some extent participation, which
was in reality 42%.5We model participation below, along with the voting decision. Table 2
displays additional interesting statistics. For instance, we observe that most people take their
decision on the vote on average 16days, or about 2 weeks, before the ballot day. Only about
20% declare to have a set opinion from the start. This shows the importance of studying
political acceptability in the presence of media coverage and political debates, to capture the
effect of (partisan) information on voters. Knowledge of the initiative is tested directly by
the interviewers, based on an open question introducing the questionnaire.
The survey covers three arguments in favor, and three arguments against the initiative.
These questions are asked only to respondents having participated in the ballot, and not to
the full sample. Respondents can state their agreement or disagreement with such statements
on a 1–4 Likert scale. The higher the score, the higher the agreement. In general, and not
surprisingly comparing with the ballot outcome, arguments against the initiative score sub-
stantially higher than those in favor. In line with the literature, high concern is expressed for
the competitiveness and distributional effects potentially generated by the implementation of
the proposal. Another argument widely used by the opponents was that over time a decreasing
tax base would have systematically implied higher tax rates, and so larger effects on the price
of energy, on competitiveness and on the distribution of income. This argument also seems
to have been well understood by the public. Consistently, the pro argument emphasizing rev-
5Predictably, the survey may slightly under-represent young individuals, and slightly over-estimate educated,
national and (by construction) Italian-speaking people. When appropriate, we control for these variables with
our econometric models. Our main findings are unchanged if using sampling weights. Given the extent of
the rejection rate observed in the ballot, and in our data, we tested whether our main results may be affected
when overweighting yes-votes. We find that our main results are in most cases quantitatively and otherwise
qualitatively unchanged even when doubling the weight given to a yes-observation.
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
108 S. Carattini et al.
Tab l e 2 VOX data: main outcomes and determinants of voting
Variable Mean SD Min. Max. N
Voting decision
No-vote 0.898 0.302 0 1 914
Participation 0.679 0.467 0 1 1509
Opinion formation
Time of resolution before ballot day 16.314 10.625 142 714
Immediate resolution 0.186 0.389 0 1 1514
Knowledge of the Energy Strategy 2050 2.767 0.861 1 4 1220
Knowledge of the initiative 0.661 0.473 0 1 1514
Agreement with arguments in favor
Revenue neutrality 2.012 1.006 1 4 856
Environmental effectiveness 2.652 1.079 1 4 922
Energy security 2.364 1.040 1 4 857
Agreement with arguments against
Competitiveness effects 3.026 1.004 1 4 908
Distributional effects 2.922 1.056 1 4 906
Decreasing tax base 3.002 1.012 1 4 852
enue neutrality as a desirable property of the initiative did not receive much support, which
corroborates the related stylized fact highlighted in the literature. The fact that higher fossil
fuel prices would have resulted in a higher degree of independence from oil and gas exporters,
and thus increased energy security, was moderately seen as a positive property of the energy
tax. Among the pro arguments, the one that scores the highest relates with the effectiveness of
energy taxes. The relative question asks respondents whether they believe that an energy tax
creates incentives to save energy, and to switch to renewable energy. Yet, this straightforward
question about the incentive effect of energy taxes does not receive massive support, and
actually performs poorly overall. Once again, we observe how the effectiveness of energy
taxes is not an established fact for the general public, and its ability to change behavior is not
shared by all the population.
We first use the full sample to analyze the determinants of voting behavior, and partici-
pation in the ballot. We focus on the main results only. Since these two outcomes are jointly
determined, we would face a selection problem if assessing voting behavior without taking
into account the decision to participate or not in the ballot. We stress that participation is not
compulsory in all cantons but one, the latter representing about 1% of the total population.
We hence apply a standard Heckman selection strategy, and estimate jointly the probability
to participate in the ballot, and to express either a “yes-” or a “no-vote”. Since both outcomes
are binary, we use a Heckman-selection probit model. The selection of variables follows
from Thalmann (2004), who used comparable VOX data. We start with a reduced model
including only “objective” socio-economic characteristics potentially affecting the decision
to participate in the ballot, or to accept the initiative. We include gender, dummies for age
categories, education, the number of cars in household (as a proxy for carbon footprint), and
the location of the voter, in terms of linguistic region and with respect to the urban-rural
cleavage. The procedure suggested in Thalmann (2004) implies running a second model, in
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
Green Taxes in a Post-Paris World: Are Millions of Nays... 109
which additional “subjective” variables are added to the “objective” model. From the standard
questions of the VOX survey, we indeed know some general preferences, political priorities
and concerns of the voters in our sample, as reported by respondents. In line with Thalmann
(2004), we consider as potentially relevant for this ballot the following variables: concern
with unemployment, with income inequality, and with public intervention in the economy.
We also include a variable capturing the political affinity as declared by the respondents,
based on the stated political positioning at the last national elections. Given that only two
parties supported the popular initiative, the Green Liberals, its promoters, and the Green
Party, while all others strongly opposed it, including all leftist parties, we capture support
for either one of the two parties as a measure of affinity with green parties (called “green
affinity” hereafter).
4.1.1 Participation
The top panel of Table 3presents the estimates for the “objective” model. All coefficients are
statistically significant in the participation model. Most estimates carry the expected sign:
both higher education and age are correlated with a higher likelihood to participate in a ballot.
Participation rates are higher for male individuals and in German speaking areas compared
to French (the dummy of reference) and Italian speaking areas. Rural areas also experience
higher turnout. These differences are very similar to those found by Thalmann (2004), and
mirror general voting behavior in Switzerland. Interestingly, car ownership is also associated
with higher ballot participation.
The bottom panel of Table 3introduces the subjective variables. Most of the previous
results concerning participation are robust to the addition of general political concerns and
affinity. Among the subjective variables, only concern with unemployment is significantly
linked to participation, with a positive sign as expected. The positive but non-significant
effect for green affinity suggests that the sponsors and supporters of the initiative were not
really able to mobilize their voters to participate in the ballot.
4.1.2 Voting Behavior
Taking into account self-selection into voting, the vote model assesses the effect of the previ-
ous variables on the likelihood to express a yes-vote in the ballot. We start again from the top
panel of Table 3. Higher education is found to be positively correlated with pro-environmental
behavior, as already shown by Deacon and Shapiro (1975). Females, young generations and
older individuals are less likely to support the initiative, exactly as in Thalmann (2004).
The subjective variables seem to substantially contribute to explain variation in the model.
In particular, we note how green affinity is linked to a higher propensity to support the ini-
tiative of the Green Liberals. Green voters may have intrinsically supported the initiative,
or voted strategically for it in order to avoid a major defeat. Polls were indeed forecasting a
rejection as the most probable outcome, even though the ultimate debacle was clearly unex-
pected. In line with predictions, concern with income inequality, with public intervention,
and with unemployment are associated with a negative coefficient, although the last is not
statistically significant. That is, the subjective variables seem to capture the main risks of the
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
110 S. Carattini et al.
Tab l e 3 Heckman-selection probit model
Vote model Participation model
Coefficients (SE) Marginal effects (SE) Coefficients (SE)
Objective model
Gender (1 = F) 0.250** (0.107) 0.029** (0.012) 0.138* (0.074)
Young (1= 18–29 years) 0.642*** (0.224) 0.074*** (0.025) 0.940*** (0.118)
Elderly (1 = 60+ years) 0.180* (0.119) 0.021* (0.013) 0.678*** (0.086)
German speaking 0.204 (0.126) 0.023 (0.014) 0.280** (0.086)
Italian speaking 0.145 (0.190) 0.017 (0.022) 0.540*** (0.107)
Education (1 = high school+) 0.274** (0.116) 0.032** (0.013) 0.277*** (0.077)
Number of cars in household 0.084 (0.097) 0.010 (0.011) 0.140** (0.041)
Municipality is rural 0.098 (0.129) 0.011 (0.015) 0.271** (0.089)
Intercept 1.418** (0.193) 0.010 (0.120)
Censored observations 489
Uncensored observations 914
Full model
Gender (1 = F) 0.240** (0.119) 0.024** (0.012) 0.123 (0.078)
Young (1= 18–29 years) 0.561* (0.277) 0.056** (0.026) 0.936*** (0.120)
Elderly (1 = 60+ years) 0.044 (0.129) 0.004 (0.013) 0.671** (0.089)
German speaking 0.140 (0.137) 0.004 (0.014) 0.265*** (0.090)
Italian speaking 0.092 (0.204) 0.009 (0.020) 0.605*** (0.090)
Education (1 = high school+) 0.145 (0.127) 0.015 (0.013) 0.268*** (0.079)
Number of cars in household 0.003 (0.083) 0.0003 (0.008) 0.113*** (0.042)
Municipality is rural 0.018 (0.138) 0.002 (0.014) 0.291*** (0.091)
Concern with unemployment 0.063 (0.046) 0.006 (0.005) 0.060** (0.027)
Concern with income inequality 0.103*** (0.038) 0.010*** (0.004) 0.022 (0.024)
Concern with public intervention 0.068* (0.037) 0.007* (0.004) 0.015 (0.023)
Green affinity 1.168*** (0.177) 0.117*** (0.022) 0.068 (0.159)
Intercept 0.557 (0.338) 0.378* (0.221)
Censored observations 455
Uncensored observations 863
Robust standard errors in parentheses
*p<0.1; ** p<0.05; *** p<0.01
4.1.3 Voting Behavior, Including Pro and Con Arguments
Tabl e 4shows the estimates for a model that includes the pros and cons described in Table
2. We recall that these variables are observed only for the respondents declaring to have
participated in the ballot. Hence, we run a simple probit model, skipping the participation
stage. Outcomes of interest are compared with the estimates of Table 3.
People’s opinions on the pro and con arguments mentioned by the survey are the main
drivers of voting behavior. All variables have the expected sign, and comparable magnitudes.
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
Green Taxes in a Post-Paris World: Are Millions of Nays... 111
Tab l e 4 Probit model including pros and cons
Coefficient (SE) Marginal effects (SE)
Gender (1 = F) 0.311 (0.203) 0.011 (0.008)
Young (1= 18–29 years) 0.478 (0.427) 0.017 (0.016)
Elderly (1 = 60+ years) 0.301 (0.207) 0.011 (0.009)
German speaking 0.256 (0.278) 0.009 (0.010)
Italian speaking 0.080 (0.360) 0.003 (0.013)
Education (1 = high school+) 0.130 (0.217) 0.005 (0.008)
Number of cars in household 0.457** (0.132) 0.016** (0.007)
Rural municipality 0.051 (0.228) 0.002 (0.008)
Concern with unemployment 0.042 (0.079) 0.002 (0.003)
Concern with income inequality 0.019 (0.065) 0.0006 (0.002)
Concern with public intervention 0.085* (0.059) 0.003* (0.002)
Green affinity 0.628** (0.260) 0.022** (0.011)
Revenue neutrality 0.617*** (0.103) 0.022** (0.007)
Environmental effectiveness 0.378*** (0.110) 0.013** (0.005)
Energy security 0.181* (0.108) 0.007* (0.004)
Competitiveness effects 0.394** (0.094) 0.014** (0.005)
Regressive effects 0.165* (0.089) 0.006* (0.003)
Decreasing tax base 0.057 (0.099) 0.002 (0.003)
Intercept 1.567* (0.848)
Pseudo R20.503
Robust standard errors in parentheses
*p<0.1; ** p<0.05; ** p<0.01
Only the coefficient for the argument about a decreasing tax base is too small to be statistically
significant. The adverse consequences of a decreasing tax base may already be accounted
for by the other variables. When looking at the marginal effects for these arguments, we
observe that the Green Liberals’ popular initiative was rejected based on the very same con-
trary arguments that are most often mentioned in the literature. Similarly, the pro arguments
contributed to higher acceptability, but their lower uptake among the general public, again in
line with the literature, did not help to substantially move the balance in favor of the reform.
For instance, the higher the agreement with the statement considering revenue neutral-
ity as a positive aspect of the proposed reform, the higher the likelihood of having voted
yes. Yet, on average people were not particularly interested in revenue neutrality. The same
applies to the energy security argument. A recurrent finding concerning the perception of
environmental effectiveness, largely discussed in the introductory part, is corroborated by
our ballot data. Being relatively confident that energy taxes provide an incentive to decrease
energy consumption and to switch to cleaner sources is linked with a higher probability of
a yes-vote. The magnitude of this effect may look relatively small if we compare with other
survey studies testing the effect of perceived effectiveness on acceptability in a similar fash-
ion, such as Baranzini and Carattini (2017). However, assessing the relevance of this and the
other effects should take into account the overall outcome of the ballot, very well replicated
by the VOX survey. In this light, the effects that we measure are considerable.
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
112 S. Carattini et al.
Similar considerations apply to the contrary arguments. The only difference is that these
were on average considered much more relevant than the pro arguments. Competitiveness
effects were already determinant in the ballot analyzed by Thalmann (2004), in spite of an
unemployment level below 2% at that time in Switzerland. At the time of the ballot that
we analyze, the unemployment rate was comfortably below 4%. Similarly to other contexts,
competitiveness concerns often take the center stage when it comes to take important polit-
ical decisions on climate policy. This can happen in spite of the overall minimal adverse
effects on competitiveness observed so far (cf. e.g. Mathys and Melo 2011). For instance,
when designing their carbon taxes, Scandinavian countries opted for very generous exemp-
tions to energy-intensive industries on competitiveness grounds, avoiding important profit
losses to the firms concerned, but also watering down the environmental effects of the policy
(Baranzini and Carattini 2014). The industry-flight argument and related fears of substan-
tial competitiveness effects largely contributed to the policy reversal observed in the case
of the Australian carbon tax (cf. Spash and Lo 2012). Hence, the general public may tend
to overestimate competitiveness effects, and this may be the result of very effective politi-
cal campaigning by energy-intensive industries and fossil energy providers (cf. Ingold and
Varone 2012).
Among the objective variables, only one significantly explains voting behavior once tak-
ing into account subjective variables and opinions on the popular initiative. This variable is
the number of cars in the households, which now reaches statistical significance. That is, as in
Thalmann (2004), the number of cars could be a measure of people’s economic sensitivity to
higher energy prices, as families with more cars are less likely to approve the initiative. Con-
cerning subjective variables, the concern for public intervention remains significant, and its
magnitude virtually unchanged with respect to Table 3. Green affinity keeps its significance,
although the marginal effect is reduced.
4.1.4 Alternative Recycling Schemes
We complete the analysis by testing the potential popularity of alternative recycling schemes.
Two specific questions were added to the standard VOX questionnaire, asking for the pre-
ferred recycling option, freely, first, and then among a list of four options. These options
are: subsidies for energy efficiency improvements and renewable energy (environmental ear-
marking), social cushioning, reduction in existing taxes, and redistribution to households and
firms. Most answers given in the open question correspond to one of these four categories.
That is, the results of the open question, in which respondents are not influenced by the
options given by the questionnaire, are very similar to those of the closed question, displayed
in Table 5.
Unsurprisingly, about 60% of respondents would like the revenues from energy taxes to
be used in the environmental domain. This result confirms previous findings in the literature,
Tab l e 5 Preferred modes of recycling
Variable Mean SD Min. Max.
Subsidies for efficiency and renewables 0.568 0.496 0 1
Social cushioning 0.115 0.320 0 1
Reduction in existing taxes 0.13 0.337 0 1
Redistribution to households and firms 0.186 0.389 0 1
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
Green Taxes in a Post-Paris World: Are Millions of Nays... 113
and suggests that Swiss voters are not different from the other samples analyzed so far.
Only a small fraction of the population would use tax revenues to provide social cushioning,
or to reduce existing taxes, and that in spite of the concerns expressed for distributional
and competitiveness effects. Similar findings on this apparent inconsistency were already
provided by Baranzini and Carattini (2017), based on a specific Swiss canton. Apparently,
such concerns affect the decision to accept or not an energy tax at a given tax rate, but
do not call for a diversion of revenues from environmental earmarking. Redistribution to
households and firms, the current way of redistributing revenues from the existing Swiss
carbon tax on heating and process fuels, is supported by about one fifth of the sample only.
That is, if citizens were asked to vote on the use of revenues of the current scheme, absent any
additional information they would probably reject lump-sum transfers, and favor a switch
towards full earmarking of revenues.6
4.2 Choice Experiment on Alternative Carbon Tax Designs
In this section we analyze decision making in our full-information choice-experiment setting
and compare it with the observed real voting behavior, and with the previous literature,
with the aim of testing our two main hypotheses concerning tax rates and recycling modes.
Tabl e 6presents our main estimates. All columns display marginal effects from conditional
logit. Column (1) shows estimates for the full sample, i.e. 1189 individuals. Since we survey
a representative sample of the population living in Switzerland, not all respondents are Swiss
nationals and so entitled to vote. Hence, column (2) restricts the sample to nationals only.
Among nationals, we have a self-declared measure of participation in the usual four ballots
per year. Column (3) excludes non-voters while column (4) retains only people declaring to
participate in all ballots. Since all results remain the same in qualitative terms and most of the
time also in quantitative terms, we discuss the coefficients based on column (1). The fact that
we find similar results for different sub-samples is however an interesting finding in itself.
That is, foreign respondents would not vote differently than Swiss citizens, according to this
sample and for this matter. If we exclude those individuals that are most likely to abstain to
better predict the outcome of a potential ballot, the results are also virtually unchanged. The
propensity to vote seems thus to have no influence on how people perceive the tax designs
proposed in our study, in spite of the non-negligible changes in samples across columns.
As expected, a higher tax rate is linked to a lower acceptability, everything else equal. This
is a standard public choice result, in line with Sælen and Kallbekken (2011), Brannlund and
Persson (2012)andGevrek and Uyduranoglu (2015). However, the difference in acceptance
between 0 and 60 francs is relatively small in comparison with the other tax rates. Hence,
in some situations, people might prefer a small carbon tax than no carbon tax at all. Given
that the tax rate of the current Swiss carbon tax on heating and process fuels was already
fixed at 60 francs at the time of the survey, we did not include in the survey a lower tax rate,
e.g. of 30 francs. Furthermore, we note that except for the first step from 0 to 60 francs, the
progression is almost linear, suggesting that a well-shaped linear demand would be a good
approximation for the case of carbon taxes.
This linearity allows speculating on the negative impact on acceptability of an extremely
high rate, as the one suggested by the popular initiative promoted by the Green Liberals and
rejected by the Swiss population. While promoters of and opponents to the popular initiative
were disagreeing on the proposal’s expected impact on energy prices, depending on the time
horizon that they used in their campaign, our most conservative computations suggest that
6Note that up to one third of revenues are already earmarked for subsidies for energy efficiency in buildings.
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
114 S. Carattini et al.
Tab l e 6 Choice experiment: estimates from conditional logit
Full sample Nationals Without no-voters Always voters
(1) (2) (3) (4)
Tax rate
0 CHF (reference)
60 CHF 0.018 0.030 0.037** 0.043*
(0.015) (0.016) (0.067) (0.020)
90 CHF 0.052*** 0.059*** 0.065*** 0.070***
(0.015) (0.016) (0.017) (0.021)
120 CHF 0.107*** 0.122*** 0.123*** 0.122***
(0.015) (0.016) (0.017) (0.020)
150 CHF 0.177*** 0.186*** 0.193*** 0.200***
(0.018) (0.016) (0.017) (0.02)
Revenue recycling
Income tax rebate (reference)
VAT reduction 0.013 0.010 0.012 0.016
(0.011) (0.012) (0.013) (0.016)
Lump-sum redistribution 0.137*** 0.136*** 0.135*** 0.127***
(0.012) (0.012) (0.013) (0.016)
Social cushioning 0.144*** 0.145*** 0.144*** 0.135***
(0.011) (0.012) (0.012) (0.016)
Environmental recycling 0.021 0.029* 0.035** 0.056**
(0.013) (0.014) (0.014) (0.018)
Number of individuals 1189 1066 980 650
Number of hypothetical votes 28536 25584 23520 15600
Pseudo-R20.0342 0.0360 0.0351 0.0404
Estimates report marginal effects from conditional logit
The dependent variable measures the acceptability of the proposed carbon tax designs
Robust standard error in parentheses
*p<0.1; **p<0.05; *** p<0.01
in the short term the tax rate would have had to be of at least 300CHF/tCO2to fully replace
the revenues of the VAT. Figure 1extrapolates linearly from the probabilities of success that
we observe based on the tax rates proposed by the survey and predicts the outcome of an
initiative proposing a tax rate of 300CHF/tCO2(see Table 10 for descriptive statistics). For
a like-to-like comparison, Fig. 1shows only the predicted likelihood of success if revenues
were to be used as proposed by the Green Liberals. While interpreting any out-of-sample
prediction always requires a lot of precaution, our extrapolation provides support for the
external validity of our choice experiment. At a rate of 300CHF/tCO2the predicted support
is virtually zero, which is very close to the share of yes-votes in the public ballot. That is, if
anything, our choice experiment predicts lower support than the ballot.
The Green Liberals’ popular initiative could probably have had a better outcome with a
different use of tax revenues. As the estimates show, reducing the current value-added tax
does not raise acceptability relative to income tax rebates (the reference case, omitted due
to multicollinearity). Together, these two revenue-recycling options are the most unpopular.
This result comes as expected and confirms our hypothesis on the low support for the idea
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
Green Taxes in a Post-Paris World: Are Millions of Nays... 115
60 120 180 240 300 360
Tax rate
0.25 .5
Fig. 1 Prediction with VAT recycling as in the Green Liberals’ initiative. Note:Filled circles indicate obser-
vations in the sample, empty circles indicate observations obtained through extrapolation
of introducing new taxes to reduce others. In this respect, it is important to recall that based
on the modeling exercise we find none or little double dividend with these two ways to
recycle revenues, the net effect on the domestic purchasing power being broadly as negative
as with the other types of recycling. This confirms a general result in the double-dividend
literature (Goulder 1995). Hence, respondents informed about the potential beneficial effects
of reducing distortionary taxes knew that they should not be expecting much of a double
dividend from lower income taxes or a reduction in the value-added tax.
We are however surprised by the estimates concerning lump-sum transfers, environmental
earmarking and to some extent social cushioning. The results that we provide for these
variables are novel in the literature and deserve to be analyzed carefully. The signs for
these variables are positive, negative and positive, respectively. That is, we find that lump-
sum transfers and social cushioning are the most preferred options for recycling, while
environmental recycling does not seem to obtain the support that it usually receives in the
literature. We have an explanation for these results and we derive salient policy implications
from them.
The most important finding concerns the low demand for recycling for environmental
purposes. This result is at odds with most of the literature on the acceptability of environ-
mental taxes previously discussed. This is the first study providing survey respondents with
an estimate of the emission abatements linked with the carbon taxes on which respondents
are requested to express their opinion. Interviewers were instructed on how to provide sim-
ple explanations on the price sensitivity of consumers and they reportedly had to use such
information to answer the general public’s curiosity on the economic bases for the figures
for emissions abatements included in the choice cards. That is, our survey addressed by con-
struction one of the main obstacles to carbon taxes: perceived ineffectiveness, which often
goes hand in hand with the demand for environmental earmarking. Since all carbon taxes in
the survey are shown to be effective, and to the extent that the scientific credibility of our
study was not challenged by respondents, the main driver for the demand for environmental
recycling is wiped out.
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
116 S. Carattini et al.
We also note that the demand for environmental recycling expressed so often in the
literature may not necessarily correspond to the most effective way of obtaining additional
emission abatements as economists would interpret it. Even with a conservative estimate
for the price of emissions on foreign carbon markets, the revenues of a carbon tax between
60 and 150 francs per ton of CO2can lead to very large emission abatements abroad. All
scenarios imply substantial negative emissions: even the lowest tax rate is shown to lead
to abatements equivalent to five times Swiss emissions. Therefore, at the current carbon
price levels, it would be very tempting for policy-makers to purchase many years of carbon
neutrality and so achieve long-term pledges, such as “the balance” between emissions and
removals by sinks, at an extremely low cost. However, we understand that the respondents
in our survey may wonder why compensating so much. The general public may also do not
like the purchase of foreign carbon credits more in general. People may have a preference for
local investments, which provide a number of local co-benefits, and may also have ethical
or practical reservations with respect to the use of offsets in general (see Conte and Kotchen
2010;Anderson 2012;Carattini and Tavoni 2016).
We now discuss the relatively high acceptability of the lump-sum redistribution. The
modeling exercise suggests moderate net gains for low-income households with lump-sum
transfers. Only social cushioning does better, while the remaining types of recycling involve
regressive effects. Respondents are informed about this fact and can internalize the beneficial
distributional properties of lump-sum redistribution. Furthermore, respondents are informed
by the introductory material that the current carbon tax on heating and process fuels is mostly
redistributed through lump-sum transfers and it may be that this information could have
increased the legitimacy of this type of recycling. This information is public, but according
to Baranzini and Carattini (2017), only a limited number of individuals are aware of the
current carbon tax on heating and process fuels, and an even smaller proportion may know
how its revenues are redistributed (e.g. one fourth of the 1012 respondents interviewed in
INFRAS 2015).
Finally, the relative popularity of social cushioning does not completely surprise, given
that distributional effects were made completely salient to respondents. Social cushioning is
shown to provide the most progressive effects over all types of recycling, although lump-sum
transfers perform similarly with moderate tax rates.
Figure 2extends the simulation of Fig. 1with the most popular recycling options, lump-
sum recycling and social cushioning. As Fig. 1already showed, our exercise suggests that
even with an extremely low tax rate recycling through VAT rebates could hardly provide a
majority in favor of a carbon tax. With social cushioning, and especially lump-sum transfers,
the picture is different. While none of the two recycling options lead us to a majority with the
tax rates considered by our survey, the prediction for recycling through lump-sum transfers
suggests that anything below 60 CHF/tCO2would be in principle acceptable. This was the
rate of the Swiss carbon tax at the time of the vote (since 2016 it is at 84 CHF). While we recall
the necessary precautions in taking at face values such predictions, we stress how recycling
modes can completely shift the demand for carbon taxes, possibly also beyond the required
threshold to make them acceptable. Based on these findings, we reformulate hypothesis 2 as
Hypothesis 2 Revenue recycling We expect acceptability to vary substantially depending
on the use of fiscal revenues. In relative terms, we expect lower acceptability
with recycling through tax rebates and reductions, as taxing here and reducing
taxes elsewhere is shown to be a criterion that the taxpayers probably gen-
erally do not request, or understand. This is particularly true in the absence
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
Green Taxes in a Post-Paris World: Are Millions of Nays... 117
Lump-sum transfers
Social benefits
VAT reduction
0 100 200 300 400
Tax rate
0 .25 .5 .75
Fig. 2 Prediction with alternative recycling compared to VAT recycling. Note:Filled circles indicate obser-
vations in the sample, empty circles indicate observations obtained through extrapolation
of a substantial double dividend. Lump-sum redistribution can be associ-
ated to higher acceptability provided that its progressive properties are made
explicit. If distributional effects are salient, social cushioning and lump-sum
redistribution can lead to higher acceptability. Providing information on car-
bon emissions abatements reduces the usual demand for revenue recycling
for environmental reinforcement, as it shows to voters the effectiveness of the
carbon tax, which they may believe to be small absent any figure. Some types
of environmental recycling may even cause lower support, such as recycling
through the purchase of foreign carbon credits.
Finally, we consider how exploiting heterogeneity across individuals may provide further
information on people’s preferences for carbon taxes. Similarly to e.g. Gevrek and Uydura-
noglu (2015), we apply a latent-class model to explain heterogeneous preferences. According
to our data, 5 latent classes can be identified.7Tabl e 11 in the “Appendix” displays how pref-
erences change across classes, based again on a conditional logit model. Table 12 introduces
information on the characteristics of respondents, aiming at describing the composition of
classes using a multinomial logit model.8
We briefly summarize the insights from this additional analysis. Classes are divided based
on the importance given to each attribute (price or revenue recycling), on the preference
for revenue recycling, the elasticity to variation in the tax rate, and overall acceptability.
Low-income households tend to be associated with classes showing a marked preference for
progressive designs, i.e. with lump-sum redistribution of revenues or social cushioning. The
overall degree of acceptability, and the related sensitivity to tax rates, seems to be linked to
different degrees of climate concern. Classes with lower degrees of climate concern tend to be
linked to rather elastic behavior, and low to moderate overall acceptability. While a positive
7AIC (BIC) values are given as follows: for two classes, 15,495 (15,616); for three classes, 14,835 (15,021);
for four classes, 14,620 (14,870); for five classes, 14,427 (14,741).
8The number of observations is limited for a series of variables, such as income or commuting preferences
for workers.
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
118 S. Carattini et al.
correlation between concern for climate mitigation and preferences for tighter climate policy
is common in the literature (see Drews and van den Bergh 2016), we are, to the best of
our knowledge, the first to empirically document different preferences for the distributional
effects of carbon taxes across the income distribution.
4.3 Discussion
4.3.1 Tax Rate
We find that higher tax rates clearly imply lower acceptability. This fact recalls once again
the general public’s sensibility with respect to the cost of climate policy, above all when
the latter is as transparent as with carbon taxes. As pointed out in the literature, this reminds
policy-makers of the importance of proceeding in small steps (Baranzini and Carattini 2014).9
Starting at a moderate tax level may also reduce the opposition by energy-intensive lobbies,
even though some evidence suggests that vested interests may be mobilized against any
departure from the status quo (see e.g. Rocchi et al. 2014). In this respect, it is important
that policy-makers have at their disposal estimates of the potential competitiveness effects of
carbon taxes. These are indeed likely to be small overall and should not be overemphasized.
Our results suggest that the general public is likely to be ready to give up some fraction of
national income, if it is convinced on the environmental effectiveness of the measures. Hence,
resistance to carbon taxes seems not to be due to complete free riding in the provision of
the global public good represented by climate change mitigation, thus supporting the idea of
some degree of cooperation in the climate commons (cf. Ostrom 2009;Carattini et al. 2015,
4.3.2 Gradual Introduction and Information
The acceptability for a given instrument may increase once the instrument is in place, sup-
porting the use of moderate tax rates to start. This for three reasons. First, the role of relative
consumption: once the tax is in place, people realize that their purchasing power compared to
others around them may be actually unchanged (Howarth 2006;Gowdy 2008). Second, the
role of revenue recycling: revenue neutrality can increase acceptability ex post, once people
see that they are given some of the money back. Of course, this requires the redistribution
of revenues to be sufficiently salient. For instance, the Citizens’ Climate Lobby suggests
introducing a carbon tax in the United States with lump-sum redistribution of revenues, and
markets it as a “carbon fee and dividend”. Every household would receive a yearly check, a
dividend in the same spirit of the very popular Alaska Permanent Fund. With full redistri-
bution, many households are net winners, as with feebates. Third, the role of observing the
functioning of the policy: as discussed, the general public tends to underestimate the effec-
tiveness of environmental taxes, especially absent any recycling for environmental purposes.
However, if the effect of the policy is sufficiently salient, people may review their beliefs ex
post, causing an important gap between perceived effectiveness (and thus acceptability) ex
ante and ex post. Evidence in this sense is provided for instance by Carattini et al. (2016),
who exploit the forced implementation of pricing garbage by the bag on a relatively large
population to assess its overall effectiveness, and its acceptability both before and after the
implementation. People are very concerned with pricing ex ante, but implementing the pol-
icy substantially reduces concerns with effectiveness and fairness. Similarly, Kallbekken and
9The descriptive statistics in Table 8report that a substantial majority of the choice-experiment sample would
have a preference for a carbon tax that starts low and increases over time.
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
Green Taxes in a Post-Paris World: Are Millions of Nays... 119
Sælen (2011) have argued in favor of the use of trial periods, based on the successful example
of the Stockholm congestion charge (see also Cherry et al. 2014). In the specific case of car-
bon taxes, Murray and Rivers (2015) show based on poll data how resistance against British
Columbia’s carbon tax substantially decreased after its introduction, with positive spillovers
to the rest of Canada. In the case under consideration, we note that although Switzerland
already has a carbon tax on heating and process fuels, an important fraction of the population
is not aware of its existence (and thus of its redistribution policy). Our choice experiment was
designed to inform voters on the effectiveness of the incentive tax using specific numbers,
something that is often missing in similar studies in the literature as well as in the political
4.3.3 Revenue Recycling
Selling an energy tax may be hard, but not impossible. Our findings from the choice exper-
iment support the decision of the Swiss government to go for full lump-sum recycling in
the planned extension of the current carbon tax on heating fuels to all fuels, as announced
in March 2015. However, our specific framework provides more detailed information on the
consequences of climate policy than is common in the public arena. As emphasized by the
VOX survey, when asked how to recycle the revenues of a green tax, a majority of voters
propose environmental earmarking. Only when informed about the effectiveness of the tax,
as in the choice experiment, other modes of recycling become more acceptable, in particular
lump-sum redistribution and social cushioning. These need not be better modes of recy-
cling the revenues of an incentive tax, but nevertheless voters should be informed clearly
and objectively about the effectiveness of an incentive tax, which is often hard to grasp for
the general public. These figures could also emphasize the existence of co-benefits for the
local population. Expecting positive co-benefits is indeed associated with higher willingness
to pay for climate change mitigation (Longo et al. 2012) as well as higher acceptability of
carbon taxes (Baranzini and Carattini 2017). The general public should also be informed
about the other effects of the tax, such as on competitiveness and the distribution of burdens.
In particular, people do not generally see the redistributive nature of lump-sum transfers.
That is, the general public should be informed about the drawbacks and advantages of the
proposed mode of revenue recycling.
We are aware that who provides this information, and how it is framed, may matter for
the public opinion, in particular for some specific subgroups. While testing this effect is
beyond the scope of this paper, we refer to a large body of work having analyzed the role
of “cues” and “frames” in different policy areas (cf. e.g. Zaller 1992;Chong and Druckman
2011). A cue is a piece of information that voters use to decide on complex issues (Eagly
and Chaiken 1993). It allows voters to save time and avoid learning the details about the
policy issue at stake. Typically, citizens who are close to a political party will follow its vote
recommendation, without necessarily improving their knowledge about and reflecting on this
issue (Lenz 2012). A frame puts the emphasis on a specific interpretation of a policy issue
(Druckman and Nelson 2003). The literature has been testing, with mixed findings, whether
and when cues and frames work (see e.g. Bullock 2011). In the case of climate change,
framing that emphasizes certain outcomes, included in our analysis or beyond (as mentioned,
local air quality, health outcomes), may help in increasing support for climate policy (see
e.g. Lakoff 2010;Lockwood 2011;Bain et al. 2012,2016;Myers et al. 2012). However,
when opinions are particularly polarized, access to information may have counterproductive
effects, depending on the opinion of the recipient (Kahan et al. 2011;Hart and Nisbet 2012).
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
120 S. Carattini et al.
5 Conclusions
National pledges are not per se credible policy commitments. The ability of countries to back
their pledges with cost-effective policies such as carbon taxes will determine the possibility
to ramp up future ambitions and to push for further policy tightening. The implementation of
carbon taxes has proven difficult in many countries, so far. Learning from these experiences
is crucial to increase their popularity and broaden their implementation in a post-Paris world.
This paper analyzes voting behavior in a real ballot on an energy tax in Switzerland.
Revenues from this energy tax were to replace completely the current value-added tax. The
proposal was massively rejected. We collected data on a large representative sample of voters.
We find that several obstacles limited its acceptability, such as distributional and competi-
tiveness concerns and perceived environmental ineffectiveness. Given the perception of little
environmental effects, revenue neutrality is not a priori a solution for the general public.
This energy tax would have instead been more popular if revenues were to be earmarked for
environmental purposes.
At the same time of the ballot, we administered a choice-experiment survey, exploiting
the salience of the topic. The choice experiment addressed all the obstacles emphasized by
the analysis of real voting behavior. Based on a computable general equilibrium model, it
provided information to all respondents on the social, economic and environmental impacts
for different tax rates and use of revenues. We analyze the demand for carbon taxes for each
design and show that this information leads to a very different outcome compared to the
ballot and the literature. First of all, revenue-neutral designs can become popular, provided
that the redistribution is achieved in a progressive fashion and its distributional effects are
explained to the public, as can be the case with lump-sum transfers. Second, environmental
earmarking may no longer be absolutely necessary to receive a substantial support for carbon
taxes, if information is provided on their environmental effectiveness.
Based on our findings we argue that policy designs usually preferred by economists,
but in most cases opposed by the general public, are not necessarily unpopular, provided
that the general public shares at least some of the information that economists have. Our
findings can help devise effective carbon taxes that are accepted by citizens, because they are
convincingly shown to be environmentally effective and because their revenues are refunded
in a form that mitigates their burden on low-income households. Addressing the concerns
and limited information of the general public is probably the only way to avoid important
resistances to cost-effective instruments of climate change mitigation, which could put at risk
the realization of the current pledges and potentially jeopardize their necessary tightening.
The consequences are known. The inability to turn Paris pledges into policy would this time
hardly leave any room to avoid running into dangerous climate changes.
Open Access This article is distributed under the terms of the Creative Commons Attribution 4.0 Interna-
tional License (, which permits unrestricted use, distribution, and
reproduction in any medium, provided you give appropriate credit to the original author(s) and the source,
provide a link to the Creative Commons license, and indicate if changes were made.
See Fig. 3and Tables 7,8,9,10,11 and 12.
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
Green Taxes in a Post-Paris World: Are Millions of Nays... 121
Fig. 3 Example of a choice card
Tab l e 7 VOX data: sample composition
Variable Mean SD Min. Max. N
Gender (female) 0.526 0.5 0 1 1514
Age 18–29 (young) 0.117 0.321 0 1 1514
Age 30–59 0.532 0.499 0 1 1514
Age 60+ (elderly) 0.351 0.477 0 1 1514
German speaking 0.534 0.499 0 1 1514
French speaking 0.267 0.442 0 1 1514
Italian speaking 0.199 0.399 0 1 1514
Education (high school+) 0.616 0.486 0 1 1514
Number of cars in household 1.381 1.031 0 9 1514
Rural municipality 0.258 0.437 0 1 1514
Concern with unemployment 4.846 1.487 1 6 1488
Concern with income inequality 3.952 1.649 1 8 1489
Concern with public intervention 4.249 1.668 1 6 1444
Green affinity 0.063 0.243 0 1 1514
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
122 S. Carattini et al.
Tab l e 8 Choice experiment: sample composition
Variable Mean SD Min. Max. N
Socio-economic characteristics
Gender (male) 0.487 0.5 0 1 1200
Age 51.711 15.263 18 94 1200
National 0.897 0.305 0 1 1200
Education (years of) 15.341 2.072 11 18 1196
Household size 2.884 1.333 1 8 1200
Household annual income
<35,000 CHF 0.06 0.237 0 1 957
35,000–50,000 CHF 0.144 0.351 0 1 957
50,000–80,000 CHF 0.242 0.429 0 1 957
80,000–120,000 CHF 0.304 0.46 0 1 957
120,000–160,000 CHF 0.154 0.361 0 1 957
160,000–200,000 CHF 0.047 0.212 0 1 957
>200,000 CHF 0.049 0.216 0 1 957
Geographical location
German speaking 0.542 0.498 0 1 1200
French speaking 0.292 0.455 0 1 1200
Italian speaking 0.167 0.373 0 1 1200
Urban agglomeration 0.264 0.441 0 1 1200
Environmental attitudes
Main transport for commuting
Car 0.578 0.494 0 1 969
Bicycle 0.195 0.396 0 1 969
Bus 0.227 0.419 0 1 969
Concern for climate change
Very threatening 0.405 0.491 0 1 1189
Somewhat threatening 0.476 0.500 0 1 1189
Not threatening 0.119 0.324 0 1 1189
Preference for gradual carbon tax 0.635 0.482 0 1 1200
Tab l e 9 Swiss population:
socio-economic characteristics
for comparison. Source All
variables come from Swiss
Statistics and concern the end of
2014. Election data concern the
federal elections of 2015
Variable Mean
Socio-economic characteristics
Gender (female) 0.505
Age 18–29 (young) 0.149
Age 30–59 0.448
Age 60+ (elderly) 0.234
National 0.757
Education (high school+) 0.521
Household size 2.25
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
Green Taxes in a Post-Paris World: Are Millions of Nays... 123
Tab l e 9 continued Variable Mean
Geographical location
German speaking 0.633
French speaking 0.227
Italian speaking 0.081
Rural municipality 0.17
Environmental attitudes
Votes to the Green Party 0.063
Votes to the Green Liberal Party 0.072
Tab l e 1 0 Choice experiment: descriptive statistics
Tax rate
60 CHF 90CHF 120 CHF 150 CHF
Income tax rebate 0.352 0.317 0.273 0.175
VAT reduction 0.319 0.319 0.229 0.193
Lump-sum redistribution 0.496 0.432 0.374 0.321
Social cushioning 0.455 0.441 0.410 0.359
Environmental recycling 0.350 0.295 0.215 0.148
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
124 S. Carattini et al.
Tab l e 1 1 Latent classes: estimates from conditional logit
Latent classes
(1) (2) (3) (4) (5)
Tax rate
0 CHF (reference)
60 CHF 0.130*** 0.326*** 0.314*** 0.582*** 0.0161
(0.032) (0.013) (0.028) (0.0110) (0.026)
90 CHF 0.099** 0.377*** 0.425*** 0.432*** 0.167***
(0.032) (0.010) (0.036) (0.017) (0.025)
120 CHF 0.069* 0.379*** 0.387*** 0.266*** 0.308***
(0.023) (0.011) (0.033) (0.019) (0.028)
150 CHF 0.119*** 0.373*** 0.372*** 0.126*** 0.463***
(0.028) (0.011) (0.035) (0.025) (0.031)
Revenue recycling
Income tax rebate (reference)
VAT reduction 0.0004 0.009 0.094* 0.038 0.002
(0.030) (0.008) (0.044) (0.021) (0.029)
Lump-sum redistribution 0.552*** 0.034*** 0.027 0.059** 0.125***
(0.031) (0.008) (0.039) (0.022) (0.026)
Social cushioning 0.589*** 0.051*** 0.0095 0.054* 0.104***
(0.0302) (0.008) (0.034) (0.023) (0.031)
Environmental recycling 0.051 0.018* 0.067 0.019 0.063
(0.038) (0.009) (0.042) (0.020) (0.033)
N3861 8190 6564 4191 5334
Pseudo-R20.3752 0.3523 0.8726 0.5399 0.1635
Estimates report marginal effects from conditional logit. The dependent variable measures the acceptability
of the proposed carbon tax designs. Robust standard error in parentheses
*p<0.1; ** p<0.05; *** p<0.01
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
Green Taxes in a Post-Paris World: Are Millions of Nays... 125
Tab l e 1 2 Latent classes: membership estimates from multinomial logit
(1) (2) (3) (4) (5)
Latent class 1 Latent class 2 Latent class 3 Latent class 4 Latent class 5
Socio-economic characteristics
Gender (male) 0.025 (0.025) 0.058* (0.035) 0.021 (0.031) 0.034 (0.028) 0.020 (0.028)
Age 0.0006 (0.001) 0.0004 (0.001) 0.0008 (0.001) 0.0001 (0.001) 0.0001 (0.002)
National 0.017 (0.041) 0.011 (0.053) 0.008 (0.049) 0.0154 (0.045) 0.030 (0.040)
Education (years
0.009 (0.007) 0.007 (0.009) 0.002 (0.009) 0.0001 (0.007) 0.004 (0.008)
Household size 0.004 (0.009) 0.012 (0.014) 0.002 (0.012) 0.004 (0.011) 0.002 (0.011)
Household annual income
<35,000 CHF 0.286** (0.125) 0.297*** (0.112) 0.069 (0.103) 0.014 (0.097) 0.072 (0.099)
50,000 CHF
0.142** (0.068) 0.184* (0.096) 0.066 (0.077) 0.014 (0.073) 0.010 (0.085)
80,000 CHF
0.061 (0.057) 0.135 (0.087) 0.070 (0.068) 0.022 (0.065) 0.018 (0.075)
120,000 CHF
0.061 (0.051) 0.108 (0.083) 0.119* (0.064) 0.005 (0.061) 0.077 (0.070)
160,000 CHF
0.031 (0.055) 0.099 (0.087) 0.090 (0.068) 0.034 (0.064) 0.013 (0.076)
200,000 CHF
0.055 (0.073) 0.117 (0.103) 0.105 (0.088) 0.041 (0.088) 0.084 (0.087)
>200,000 CHF
Geographical location
French speaking 0.0332 (0.027) 0.040 (0.036) 0.005 (0.034) 0.0005 (0.030) 0.001 (0.032)
Italian speaking 0.062* (0.036) 0.056 (0.050) 0.056 (0.051) 0.007 (0.041) 0.057 (0.042)
German speaking (reference)
0.002 (0.027) 0.032 (0.038) 0.012 (0.036) 0.021 (0.0314) 0.002 (0.031)
Environmental attitudes
Main transport for commuting
Car 0.027 (0.030) 0.089** (0.040) 0.006 (0.038) 0.077** (0.039) 0.045 (0.037)
Bicycle 0.009 (0.036) 0.103** (0.049) 0.039 (0.049) 0.101** (0.043) 0.032 (0.044)
Bus (reference)
Concern for climate change
0.023 (0.050) 0.095* (0.057) 0.095* (0.050) 0.041 (0.051) 0.063 (0.044)
0.083* (0.048) 0.0003 (0.057) 0.037 (0.048) 0.052 (0.050) 0.098** (0.043)
Not threatening (reference)
Average class
0.7844 0.8588 0.9732 0.8110 0.9047
Share of
13.3% 29.2% 23.1% 15.3% 19.2%
Estimates report marginal effects. Robust standard error in parentheses. * p<0.05; ** p<0.01; *** p<0.001
Average class probabilities and share of respondents obtained when identifying latent classes (AIC= 14427,
BIC = 14741)
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
126 S. Carattini et al.
Alm J, Bloomquist KM, McKee M (2015) On the external validity of laboratory tax compliance experiments.
Econ Inq 53(2):1170–1186
Anderson K (2012) The inconvenient truth of carbon offsets. Nat News 484(7392):7
Bain PG, Hornsey MJ, Bongiorno R, Jeffries C (2012) Promoting pro-environmental action in climate change
deniers. Nat Clim Change 2(8):600–603
Bain PG, Milfont TL, Kashima Y, Bilewicz M, Doron G, Garðarsdóttir RB, Gouveia VV, Guan Y, Johansson
L-O, Pasquali C, Corral-Verdugo V, Aragones JI, Utsugi A, Demarque C, Otto S, Park J, Soland M, Steg
L, González R, Lebedeva N, Madsen OJ, Wagner C, Akotia CS, Kurz T, Saiz JL, Schultz PW, Einarsdóttir
G, Saviolidis NM (2016) Co-benefits of addressing climate change can motivate action around the world.
Nat Clim Change 6(2):154–157
Baranzini A, Bergh J, Carattini S, Howarth R, Padilla E, Roca J (2015) Seven reasons to use carbon pricing in
climate policy. Working Paper wpdea1507, Department of Applied Economics at Universitat Autonoma
of Barcelona
Baranzini A, Carattini S (2014) Taxation of emissions of greenhouse gases. In: Freedman B (ed) Global
environmental change, number 1 in handbook of global environmental pollution. Springer, Dordrecht,
pp 543–560
Baranzini A, Carattini S (2017) Effectiveness, earmarking and labeling: testing the acceptability of carbon
taxes with survey data. Environ Econ Policy Stud 19(1):197–227
Baranzini A, Goldemberg J, Speck S (2000) A future for carbon taxes. Ecol Econ 32(3):395–412
Bornstein N, Lanz B (2008) Voting on the environment: Price or ideology? Evidence from Swiss referendums.
Ecol Econ 67(3):430–440
Boyle KJ, Welsh MP, Bishop RC (1993) The role of question order and respondent experience in contingent-
valuation studies. J Environ Econ Manag 25(1):S80–S99
Brannlund R, Persson L (2012) To tax, or not to tax: preferences for climate policy attributes. Clim Policy
Bristow AL, Wardman M, Zanni AM, Chintakayala PK (2010) Public acceptability of personal carbon trading
and carbon tax. Ecol Econ 69(9):1824–1837
Bullock JG (2011) Elite influence on public opinion in an informed electorate. Am Polit Sci Rev 105(3):496–
Cameron TA, Englin J (1997) Respondent experience and contingent valuation of environmental goods. J
Environ Eco Manag 33(3):296–313
Carattini S, Tavoni A (2016) How green are green economists? Econ Bull 36(4):2311–2323
Carattini S, Baranzini A, Roca J (2015) Unconventional determinants of greenhouse gas emissions: the role
of trust. Environ Policy Gov 25(4):243–257
Carattini S, Baranzini A, Lalive R (2016) Is taxing waste a waste of time? Evidence from a supreme court
decision. Working Paper 227, Grantham Research Institute on Climate Change and the Environment,
Carattini S, Levin S, Tavoni A (2017) Cooperation in the climate commons. Technical report 259, Grantham
Research Institute on Climate Change and the Environment, London
Cherry TL, Kallbekken S, Kroll S (2012) The acceptability of efficiency-enhancing environmental taxes,
subsidies and regulation: an experimental investigation. Environ Sci Policy 16:90–96
Cherry TL, Kallbekken S, Kroll S (2014) The impact of trial runs on the acceptability of environmental taxes:
experimental evidence. Resour Energy Econ 38(C):84–95
Chong D, Druckman JN (2011) Public–elite interactions—puzzles in search of researchers. In: Shapiro RY,
Jacobs LR (eds) The Oxford handbook of American public opinion and the media. Oxford University
Press, Oxford, pp 170–188
Conte MN, Kotchen MJ (2010) Explaining the price of voluntary carbon offsets. Clim Change Econ 1(2):93–
Czajkowski M, Hanley N, LaRiviere J (2015) The effects of experience on preferences: theory and empirics
for environmental public goods. Am J Agric Econ 97(1):333–351
Deacon RT, Shapiro P (1975) Private preference for collective goods revealed through voting on referenda.
Am Econ Rev 65(5):943–955
Deroubaix J-F, Lévèque F (2006) The rise and fall of French Ecological Tax Reform: social acceptability
versus political feasibility in the energy tax implementation process. Energy Policy 34(8):940–949
Dresner S, Dunne L, Clinch P, Beuermann C (2006) Social and political responses to ecological tax reform in
Europe: an introduction to the special issue. Energy Policy 34(8):895–904
Drews S, van den Bergh JCJM (2016) What explains public support for climate policies? A review of empirical
and experimental studies. Clim Policy 16(7):855–876
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
Green Taxes in a Post-Paris World: Are Millions of Nays... 127
Druckman JN, Nelson KR (2003) Framing and deliberation: how citizens’ conversations limit elite influence.
Am J Polit Sci 47(4):729–745
Eagly AH, Chaiken S (1993) Psychology of attitudes. Cengage Learning, Fort Worth
Ecoplan (2012) Volkswirtschaftliche Auswirkungen einer ökologischen Steuerreform—Analyse mit einem
berechenbaren Gleichgewichtsmodell für die Schweiz. Technical report, Bundesamt für Energie, Eid-
genössische Steuerverwaltung und Eidgenössische Finanzverwaltung, Berne
Falk A, Heckman JJ (2009) Lab experiments are a major source of knowledge in the social sciences. Science
Fankhauser S, Gennaioli C, Collins M (2015) Do international factors influence the passage of climate change
legislation? Clim Policy 16(3):318–331
Fischel WA (1979) Determinants of voting on environmental quality: a study of a New Hampshire pulp mill
referendum. J Environ Econ Manag 6(2):107–118
Fort R, Bunn DN (1998) Whether one votes and how one votes. Public Choice 95(1/2):51–62
Gevrek Z, Uyduranoglu A (2015) Public preferences for carbon tax attributes. Ecol Econ 118:186–197
Goulder LH (1995) Environmental taxation and the double dividend: a reader’s guide. Int Tax Public Financ
Gowdy JM (2008) Behavioral economics and climate change policy. J Econ Behav Organ 68(3–4):632–644
Halbheer D, Niggli S, Schmutzler A (2006) What does it take to sell environmental policy? An empirical
analysis of referendum data. Environ Resour Econ 33(4):441–462
Harrison GW, List JA (2004) Field experiments. J Econ Lit 42(4):1009–1055
Hart PS, Nisbet EC (2012) Boomerang effects in science communication: how motivated reasoning and identity
cues amplify opinion polarization about climate mitigation policies. Commun Res 39(6):701–723
Howarth RB (2006) Optimal environmental taxes under relative consumption effects. Ecol Econ 58(1):209–
INFRAS (2015) Klimaschutz und Grüne Wirtschaft—was meint die Bevölkerung? Ergebnisse einer repräsen-
tativen Bevölkerungsbefragung—Schlussbericht. Technical report, Bundesamt für Umwelt, Zurich
Ingold K, Varone F (2012) Treating policy brokers seriously: evidence from the climate policy. J Public Adm
Res Theory 22(2):319–346
IPCC (2014) Fifth assessment report—mitigation of climate change. Technical report
Jacobsen GD (2011) The Al Gore effect: an inconvenient truth and voluntary carbon offsets. J Environ Econ
Manag 61(1):67–78
Jordan AJ, Huitema D, Hildén M, Asselt H, Rayner TJ, Schoenefeld JJ, Tosun J, Forster J, Boasson EL (2015)
Emergence of polycentric climate governance and its future prospects. Nat Clim Change 5(11):977–982
Kahan D, Wittlin M, Peters E, Slovic P, Ouellette L, Braman D, Mandel G (2011) The tragedy of the risk-
perception commons: culture conflict, rationality conflict, and climate change. SSRN Scholarly Paper
ID 1871503, Social Science Research Network
Kahn ME (2002) Demographic change and the demand for environmental regulation. J Policy Anal Manag
Kahn ME, Matsusaka JG (1997) Demand for environmental goods: evidence from votingpatterns on California
initiatives. J Law Econ 40(1):137–174
Kallbekken S, Aasen M (2010) The demand for earmarking: results from a focus group study. Ecol Econ
Kallbekken S, Kroll S, Cherry TL (2010) Pigouvian tax aversion and inequity aversion in the lab. Econ Bull
Kallbekken S, Kroll S, Cherry TL (2011) Do you not like Pigou, or do you not understand him? Tax aversion
and revenue recycling in the lab. J Environ Econ Manag 62(1):53–64
Kallbekken S, Sælen H (2011) Public acceptance for environmental taxes: self-interest, environmental and
distributional concerns. Energy Policy 39(5):2966–2973
Kirchgassner G, Schneider F (2003) On the political economy of environmental policy. Public Choice 115(3–
Kriesi H (2005) Direct democratic choice: the Swiss experience. Lexington, Lanham
Lakoff G (2010) Why it matters how we frame the environment. Environ Commun 4(1):70–81
Lenz GS (2012) Follow the leader? How voters respond to politicians’ policies and performance. University
of Chicago Press, Chicago
Lockwood M (2011) Does the framing of climate policies make a difference to public support? Evidence from
UK marginal constituencies. Clim Policy 11(4):1097–1112
Longo A, Hoyos D, Markandya A (2012) Willingness to pay for ancillary benefits of climate change mitigation.
Environ Resour Econ 51(1):119–140
Marcantonini C, Ellerman AD (2014) The implicit carbon price of renewable energy incentives in Germany.
RSCAS Working Paper 2014/28, European University Institute
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
128 S. Carattini et al.
Marchiori C, Dietz S, Tavoni A (2017) Domestic politics and the formation of international environmental
agreements. J Environ Econ Manag 81:115–131
Mathys NA, de Melo J (2011) Political economy aspects of climate change mitigation efforts. World Econ
Metcalf GE (2009) Designing a carbon tax to reduce U.S. greenhouse gas emissions. Rev Environ Econ Policy
Millner A, Ollivier H (2016) Beliefs, politics, and environmental policy. Rev Environ Econ Policy 10(2):226–
Mohler L, Müller D (2012) Substitution elasticities in Swiss manufacturing. Technical report, Bundesamt für
Energie, Berne
Murray B, Rivers N (2015) British Columbia’s revenue-neutral carbon tax: a review of the latest “grand
experiment” in environmental policy. Energy Policy 86:674–683
Myers TA, Nisbet MC, Maibach EW, Leiserowitz AA (2012) A public health frame arouses hopeful emotions
about climate change. Clim Change 113(3–4):1105–1112
Nathani C, Sutter D, van Nieuwkoop R, Kraner S, Peter M (2011) Energiebezogene Differenzierung der
Schweizerischen Input-Output-Tabelle. Technical report, Bundesamt für Energie, Berne
Nemet GF, Johnson E (2010) Willingness to pay for climate policy: a review of estimates. SSRN Scholarly
Paper ID 1626931, Social Science Research Network
Oates WE, Portney PR (2003) The political economy of environmental policy. In: Vincent K-GMJR (ed) Hand-
book of environmental economics, volume 1 of environmental degradation and institutional responses.
Elsevier, Amsterdam, North Holland, pp 325–354
Ostrom E (2009) A polycentric approach for coping with climate change. Policy Research Working Paper
Series, The World Bank
Rocchi P, Serrano M, Roca J (2014) The reform of the European energy tax directive: exploring potential
economic impacts in the EU27. Energy Policy 75:341–353
Sælen H, Kallbekken S (2011) A choice experiment on fuel taxation and earmarking in Norway. Ecol Econ
Salka WM (2001) Urban–rural conflict over environmental policyin the Western United States. Am Rev Public
Adm 31(1):33–48
Sampei Y, Aoyagi-Usui M (2009) Mass-media coverage, its influence on public awareness of climate-change
issues, and implications for Japan’s national campaign to reduce greenhouse gas emissions. Glob Environ
Change 19(2):203–212
Spash CL, Lo AY (2012) Australia’s carbon tax: a sheep in wolf’s clothing? Econ Labour Relat Rev 23(1):67–
Stadelmann-Steffen I (2011) Citizens as veto players: climate change policy and the constraints of direct
democracy. Environ Polit 20(4):485–507
Steg L, Dreijerink L, Abrahamse W (2006) Why are energy policies acceptable and effective? Environ Behav
Thalmann P (2004) The public acceptance of green taxes: 2 million voters express their opinion. Public Choice
Tiezzi S, Xiao E (2016) Time delay, complexity and support for taxation. J Environ Econ Manag 77:117–141
Vöhringer F (2012) Linking the Swiss emissions trading system with the EU ETS: economic effects of
regulatory design alternatives. Swiss J Econ Stat SJES 148(II):167–196
Whitehead JC, Blomquist GC, Hoban TJ, Clifford WB (1995) Assessing the validity and reliability of con-
tingent values: a comparison of on-site users, off-site users, and non-users. J Environ Econ Manag
World Bank (2014) State and trends of carbon pricing 2014. Technical report
Zaller JR (1992) The nature and origins of mass opinion. Cambridge University Press, Cambridge
Content courtesy of Springer Nature, terms of use apply. Rights reserved.
Terms and Conditions
Springer Nature journal content, brought to you courtesy of Springer Nature Customer Service Center
GmbH (“Springer Nature”).
Springer Nature supports a reasonable amount of sharing of research papers by authors, subscribers
and authorised users (“Users”), for small-scale personal, non-commercial use provided that all
copyright, trade and service marks and other proprietary notices are maintained. By accessing,
sharing, receiving or otherwise using the Springer Nature journal content you agree to these terms of
use (“Terms”). For these purposes, Springer Nature considers academic use (by researchers and
students) to be non-commercial.
These Terms are supplementary and will apply in addition to any applicable website terms and
conditions, a relevant site licence or a personal subscription. These Terms will prevail over any
conflict or ambiguity with regards to the relevant terms, a site licence or a personal subscription (to
the extent of the conflict or ambiguity only). For Creative Commons-licensed articles, the terms of
the Creative Commons license used will apply.
We collect and use personal data to provide access to the Springer Nature journal content. We may
also use these personal data internally within ResearchGate and Springer Nature and as agreed share
it, in an anonymised way, for purposes of tracking, analysis and reporting. We will not otherwise
disclose your personal data outside the ResearchGate or the Springer Nature group of companies
unless we have your permission as detailed in the Privacy Policy.
While Users may use the Springer Nature journal content for small scale, personal non-commercial
use, it is important to note that Users may not:
use such content for the purpose of providing other users with access on a regular or large scale
basis or as a means to circumvent access control;
use such content where to do so would be considered a criminal or statutory offence in any
jurisdiction, or gives rise to civil liability, or is otherwise unlawful;
falsely or misleadingly imply or suggest endorsement, approval , sponsorship, or association
unless explicitly agreed to by Springer Nature in writing;
use bots or other automated methods to access the content or redirect messages
override any security feature or exclusionary protocol; or
share the content in order to create substitute for Springer Nature products or services or a
systematic database of Springer Nature journal content.
In line with the restriction against commercial use, Springer Nature does not permit the creation of a
product or service that creates revenue, royalties, rent or income from our content or its inclusion as
part of a paid for service or for other commercial gain. Springer Nature journal content cannot be
used for inter-library loans and librarians may not upload Springer Nature journal content on a large
scale into their, or any other, institutional repository.
These terms of use are reviewed regularly and may be amended at any time. Springer Nature is not
obligated to publish any information or content on this website and may remove it or features or
functionality at our sole discretion, at any time with or without notice. Springer Nature may revoke
this licence to you at any time and remove access to any copies of the Springer Nature journal content
which have been saved.
To the fullest extent permitted by law, Springer Nature makes no warranties, representations or
guarantees to Users, either express or implied with respect to the Springer nature journal content and
all parties disclaim and waive any implied warranties or warranties imposed by law, including
merchantability or fitness for any particular purpose.
Please note that these rights do not automatically extend to content, data or other material published
by Springer Nature that may be licensed from third parties.
If you would like to use or distribute our Springer Nature journal content to a wider audience or on a
regular basis or in any other manner not expressly permitted by these Terms, please contact Springer
Nature at
... In an international survey, Carattini et al. (2019) show that lowering income taxes, redistributing revenues domestically, and green spending receive majority support. Carattini et al. (2017) find that making distributional effects of revenue recycling schemes more salient increases the demand for progressive designs. Inquiring about the acceptability of a carbon tax among US and German citizens, Beiser-McGrath and Bernauer (2019) detect that it increases when other countries introduce a similar carbon tax. ...
... Finally, the respondents support lowering other taxes (23%) or raising fiscal revenues (10%) least. The low support of reducing other taxes and increasing fiscal revenues is in line with, for instance, Beiser-McGrath and Bernauer (2019), Carattini et al. (2017), and Kotchen et al. (2017). ...
... Following and Dresner et al. (2006), it might be that respondents view taxes solely as a means to raise revenue rather than an incentive to reduce emissions. In contrast to Carattini et al. (2017), we do not find that supporting a lump-sum payment is associated with a higher support for a carbon tax. Yet, in line with Beiser-McGrath and Bernauer (2019), we detect that using the revenues from a carbon tax to support citizens with low incomes (social cushioning) is associated with a decrease in the support for a carbon tax. ...
Full-text available
While the economic case for carbon pricing is compelling, public support for it remains low. Using a stated-choice experiment with a sample of 6000 German household heads, we examine how their fairness preferences influence support for carbon taxes under different revenue uses. We find that respondents who prefer green spending are more likely to support a carbon tax, but the support diminishes considerably for higher tax rates – in contrast to respondents who support social cushioning. When restricted to options for direct revenue redistribution, Germans prefer lump-sum payments over directing payments to the poorest or the most affected. Preferences over these options depend both on genuinely different concepts of fairness and economic circumstances. Our findings have implications for advancing carbon pricing, as its support can be increased substantially when designed according to citizens' fairness preferences.
... Instead, it has been suggested that highly visible lump-sum rebates or 'dividends' could be more effective in winning public support and reinforcing that support over time as beneficiaries become accustomed to regular dividends 37 . The hypothetical potential of climate rebates to increase public carbon pricing support has been shown in the United States 4,17,20,21,29 , Canada 38 , Norway 35 , Switzerland 39 , the United Kingdom 4,30 , Australia 4 , Germany 17 , Turkey 27 , France 40 and India 4 . These studies offer strong reasons to expect that bundling carbon taxes with lump-sum rebates could increase public acceptance. ...
... Surveys measuring public support for hypothetical policies may overestimate voters' support when confronted with real-world costs. For example, polling overestimated voter support for failed carbon tax referenda in Washington state 5 and Switzerland 39 . Voters' perceptions of rebate costs and benefits may also be shaped by competing partisan and interest-group narratives 5,40,41 . ...
We find limited evidence that individual or household rebates (also called dividends) have increased public support for carbon taxes in Canada and Switzerland. In the presence of partisan and interest group conflict over climate policy, policymakers should not assume that voter support for carbon pricing will automatically increase with the inclusion of rebates. Rebates do not offer a panacea to public opposition to carbon taxation. Taxpayers often remain unaware of the rebate’s existence or underestimate the rebate’s value.Public support for carbon pricing remains structured by partisanship and ideology, even when individuals or households receive material benefits.In the presence of partisan and interest group conflict over carbon taxes, when the costs of carbon taxation are salient, policymakers should not assume that voters’ support for carbon pricing will automatically increase with rebate inclusion.Efforts to increase the political efficacy of dividends must focus on ensuring that citizens understand this policy instrument and must test whether increasing dividend visibility can increase support. Rebates do not offer a panacea to public opposition to carbon taxation. Taxpayers often remain unaware of the rebate’s existence or underestimate the rebate’s value. Public support for carbon pricing remains structured by partisanship and ideology, even when individuals or households receive material benefits. In the presence of partisan and interest group conflict over carbon taxes, when the costs of carbon taxation are salient, policymakers should not assume that voters’ support for carbon pricing will automatically increase with rebate inclusion. Efforts to increase the political efficacy of dividends must focus on ensuring that citizens understand this policy instrument and must test whether increasing dividend visibility can increase support.
... Instead, it has been suggested that highly visible lump-sum rebates or 'dividends' could be more effective in winning public support and reinforcing that support over time as beneficiaries become accustomed to regular dividends 37 . The hypothetical potential of climate rebates to increase public carbon pricing support has been shown in the United States 4,17,20,21,29 , Canada 38 , Norway 35 , Switzerland 39 , the United Kingdom 4,30 , Australia 4 , Germany 17 , Turkey 27 , France 40 and India 4 . These studies offer strong reasons to expect that bundling carbon taxes with lump-sum rebates could increase public acceptance. ...
... Surveys measuring public support for hypothetical policies may overestimate voters' support when confronted with real-world costs. For example, polling overestimated voter support for failed carbon tax referenda in Washington state 5 and Switzerland 39 . Voters' perceptions of rebate costs and benefits may also be shaped by competing partisan and interest-group narratives 5,40,41 . ...
Full-text available
Revenue recycling through lump-sum dividends may help mitigate public opposition to carbon taxes, yet evidence from real-world policies is lacking. Here we use survey data from Canada and Switzerland, the only countries with climate rebate programmes, to show low public awareness and substantial underestimation of climate rebate amounts in both countries. Information was obtained using a five-wave panel survey that tracked public attitudes before, during and after implementation of Canada’s 2019 carbon tax and dividend policy and a large-scale survey of Swiss residents. Experimental provision of individualized information about true rebate amounts had modest impacts on public support in Switzerland but potentially deleterious effects on support in Canada, especially among Conservative voters. In both countries, we find that perceptions of climate rebates are structured less by informed assessments of economic interest than by partisan identities. These results suggest limited effects of existing rebate programmes, to date, in reshaping the politics of carbon taxation.
... These methods focus on a single nation, but recent models use panel techniques based on data on many economies, such as as in Reference [25], or in Reference [11]. More recent models use evidence from interviews to determine whether the CO 2 price changes have induced cuts [26]. ...
Full-text available
Studies of carbon emissions typically focus on price and tax effects or technology. We argue that the two are closely linked within an economy in disequilibrium. Our goals are twofold: (1) to examine the combined role of: low CO2 technology, fuel taxes and CO2 tax on taming CO2 emissions and (2) to build a counterfactual analysis by capturing anything else that causes emissions to diverge from the trend such as renewable energy, energy laws and the state of the economy. The equilibrium correction model (EqCM) suggests that emissions have a long-term relationship with economic growth, fossil fuel use, taxes and clean power sources. Both oil and gas extraction and economic growth raise Norway’s emissions, offsetting the mitigating effect of taxes. Sweden´s carbon fuel tax elasticity is 20%, a value far above Norway´s elasticity, even though these carbon taxes were phased-in under a period of macroeconomic instability, weakening their effectiveness. The income elasticity of emissions is negative for Norway and positive for Sweden. Emission cuts require (a) de-growth, (b) a higher tax on transport fuels and (c) electrification of transport. The effects of tax, technology, economic growth and those for the pre- and post-carbon tax era differ strongly in the two nations.
Full-text available
Public support for stringent climate policies is currently weak. We develop a model to study the dynamics of public support for climate policies. It comprises three interconnected modules: one calculates policy impacts; a second translates these into policy support mediated by social inuence; and a third represents the regulator adapting policy stringency depending on public support. The model combines general-equilibrium and agent-based elements and is empirically grounded in a household survey, which allows quantifying policy support as a function of eectiveness, personal wellbeing and distri-butional eects. We apply our approach to compare two policy instruments, namely carbon taxation and performance standards, and identify intertemporal trajectories that meet the climate target and count on sucient public support. Our results highlight the importance of social inuence, opinion stability and income inequality for public support of climate policies. Assuming that misperceptions vanish overtime, our model predicts that carbon taxation consistently generates more public support than standards. Finally, we show that under moderate social inuence and income inequality, an increasing carbon tax trajectory combined with progressive revenue redistribution receives the highest average public support over time.
Around the world, most people are aware of the problem of climate change, believe it is anthropogenic, and feel concerned about its potential consequences. What they think should be done about the problem, however, is less clear. Particularly due to widespread support among policy experts for putting a price on greenhouse gas emissions, more studies have investigated public attitudes towards carbon taxes than any other type of policy. Such studies have found substantial public opposition to carbon taxes, largely due to political distrust, though also some evidence that careful design and messaging can mitigate people’s skepticism. Surprisingly few studies have investigated attitudes towards other climate policies, and there is an urgent need for more research about what—given their beliefs about the nature and severity of the problem—people would like to see their governments doing. This is especially the case for residents of lower-income and/or non-Western nations.
Full-text available
Public acceptance of sustainable energy innovations and policies is of crucial importance in enabling the transition to decarbonized energy systems necessary to meet the key climate targets of the Paris Agreement. This is particularly important in the context of the European Union, which is the third largest energy-related greenhouse gas emitter in the world. However, achieving acceptance is complex and requires improved understanding of the underlying conditions that are likely to motivate it. To contribute to this understanding and overcome common shortcomings in the literature, this paper presents a multidimensional and cross-national framework for the factors that have the potential to motivate both dimensions of acceptance, namely adoption and support. The innovations of interest are numerous and include electric vehicles, residential solar panels, energy-efficient home insulation, environmental taxes and incentives. The paper employs multilevel regression analysis and combines individual and contextual data from all the European Union nations to demonstrate the significance of various types of predictors in motivating acceptance. It is found that citizens’ personal capabilities and attitudes towards life satisfaction, climate change and the environment influence both dimensions of acceptance. Attitudes towards broader socio-political dimensions such as representation, equity and transparency primarily influence support, whereas national environmental and energy policy indicators primarily influence adoption. Overall, this paper provides evidence suggesting governments should simultaneously address both dimensions of acceptance, through a combination of different means: enhancing support through strategies that target attitudes and preferences, and market-based environmental policies that promote adoption at the household level.
There are limited studies on specific factors that affect willingness-to-pay (WTP) and public concerns on spending of pollution pricing in democratic economies that are carbon dependent. In light of the discourse on global pollution pricing, this study explores the complex influence of political-economic, attitudinal, and socio-demographic factors on carbon pricing, by estimating the WTP in a carbon resource-dependent economy such as Canada and the preferred revenue earmarking of Canadians. An online survey of 600 Canadian households was conducted using the random device engagement (RDE) approach. This study uses a contingent valuation method (CVM) and payment card (P.C.) to estimate the household WTP for carbon pricing on direct energy expenditure and an ordered logistic regression model for odds ratio estimates. The estimated annual WTP ranges between CAD$ 84 to CAD$ 230 in 2019 (CAD$ 1 = US$ 0.7538). This implies an acceptable increment of 1.5%–2.5% (CAD$ 157 to CAD$ 259) to the average yearly household energy expenditures. This study suggests that Canadians appear to be supportive of redistributing carbon price revenues and investing in clean energy technology. Canadian government needs to address public concerns surrounding political-economic factors, specifically the energy cost implication for vulnerable households in order to achieve emission reduction targets.
Combustion of fossil fuels is the major source of energy in the United States and around the world. The combustion causes emission of greenhouse gases and particle pollution, which leads to health hazards. As people become increasingly conscious of their carbon footprints, they may choose to reduce their energy consumption using a variety of energy-saving technologies. We design a context-rich incentivized decision-making experiment in a laboratory set-up. The decision scenario has been enriched with elements of a public good, risk, and intertemporal discounting. Each subject represents a household and decides how much to spend on energy-saving technologies that can reduce future energy costs and emissions. The reduction in emission decreases health risk and medical costs for an individual and everyone else in the group. Discounting is represented by the ability to save, with interest. Each subject plays three sections (baseline, a treatment, and a repeated baseline). Each section had 30 rounds. The treatment has a threshold public good feature of energy-savings. The emission tax level depends on the aggregate energy-savings. Subjects exhibit significant learning effect and tend to increase adoption rate of energy-saving technologies over time. The adoption rate significantly improves when subjects can reduce their emission tax obligations by decreasing their energy consumption. There is no evidence of significant change in behavior when subjects learn energy-saving choices made by other group members.
Full-text available
Environmental taxes are often underexploited. This paper analyses the effectiveness of a garbage tax, assessing its effects on multiple outcomes as well as its acceptability. We study how a Supreme Court decision, mandating the Swiss Canton of Vaud to implement a tax on garbage, affects garbage production and beliefs about the tax. We adopt a difference-indifferences approach exploiting that parts of Vaud already implemented a garbage tax before the mandate. Pricing garbage by the bag (PGB) is highly effective, reducing unsorted garbage by 40%, increasing recycling of aluminium and organic waste, without causing negative spillovers on adjacent regions. The effects of PGB seem very persistent over time. Our assessment of PGB looks very favourable. It may surprise that PGB is not implemented more often. Hence, we look at people's perceptions. We find that people are very concerned with PGB ex ante. Public opposition seems to be the main obstacle to PGB. However, implementing PGB reduces concerns with effectiveness and fairness substantially. After implementing PGB, people accept 70% higher garbage taxes compared to before PGB. We argue that environmental taxes could be much more diffused, if people had the chance to experience their functioning and correct their beliefs.
Working Paper
Full-text available
Published on July 10, 2019, in the Review of Environmental Economics and Policy. Open access version available at: Full reference: Stefano Carattini, Simon Levin, Alessandro Tavoni, Cooperation in the Climate Commons, Review of Environmental Economics and Policy, rez009,
Full-text available
This paper analyzes the decision of " green " economists to participate in the carbon offset market, and how this decision is related with the views that these experts hold on offsets. It also compares the preferences of economists with those of the general public, as emphasized in the literature. The paper exploits a unique dataset examining the decision to purchase carbon offsets at two academic conferences in environmental and ecological economics. We find that having the conference expenses covered by one's institution increases the likelihood of offsetting, but practical and ethical reservations as well as personal characteristics and preferences also play an important role. We focus on the effect of objecting to the use of offsets and discuss the implications for practitioners and policy-makers. Based on our findings, we suggest that ecological and environmental economists should be more involved in the design and use of carbon offsets. Corresponding author: We thank Timothy Foxon, Jasper Kenter, Irene Ring and Julia Steinberger from ESEE, as well as Monica Eberle, Markku Ollikainen, Sampo Pihlainen and Olli Tahvonen from EAERE, for help with both administering the survey and sourcing data on the participants. We are also grateful to the participants of the ESEE and EAERE conferences who took part in our study, and to Greer Gosnell and two anonymous referees for very useful comments. We also thank Matthew Kotchen for very insightful conversations.
Full-text available
Experts and the general public often perceive environmental problems differently. Moreover, regulatory responses to environmental issues often do not coincide with consensus expert recommendations. These two facts are mutually consistent – it is unlikely that regulations based on factual claims that are substantially different from voters’ opinions would be politically feasible. Given that the public’s beliefs constrain policy choices, it is vital to understand how beliefs are formed, whether they will be biased, and how the inevitable heterogeneity in people’s beliefs filters through the political system to affect policy. We review recent theoretical and empirical work on individual inference, social learning, and the supply of information by the media, and identify the potential for biased beliefs to arise. We then examine the interaction between beliefs and politics: can national elections and legislative votes be expected to result in unbiased collective decisions, do heterogeneous beliefs induce strategic political actors to alter their policy choices, and how do experts and lobby groups affect the information available to policy-makers? We conclude by suggesting that the relationship between beliefs and policy choices is a relatively neglected aspect of the theory of environmental regulation, and a fruitful area for further research.
Public opinion research demonstrates that citizens' opinions depend on elite rhetoric and interpersonal conversations. Yet, we continue to have little idea about how these two forces interact with one another. In this article, we address this issue by experimentally examining how interpersonal conversations affect (prior) elite framing effects. We find that conversations that include only common perspectives have no effect on elite framing, but conversations that include conflicting perspectives eliminate elite framing effects. We also introduce a new individual level moderator of framing effects-called "need to evaluate"-and we show that framing effects, in general, tend to be short-lived phenomena. In the end, we clarify when elites can and cannot use framing to influence public opinion and how interpersonal conversations affect this process.