Do environmental taxes and environmental stringency policies reduce CO2 emissions? Evidence from 7 emerging economies

Do Environmental Stringency Policies and Human Development Reduce CO2 Emissions? Evidence from G7 and BRICS Economies

“…Botta and Kózluk [ 19 ] claimed that the Environmental Policy Stringency indicators should be considered “a first tangible effort to measure environmental policy stringency internationally over a relatively long-time horizon”, even though they represent a simplification of the multifaceted and multidimensional approach of environmental policies. However, as explained by Wolde-Rufael and Mulat-Weldemeskel [ 17 ], despite the fact that environmental tax and environmental policy stringency have become pivotal policy instruments against environmental degradation, there is still a research gap with respect to their combined effectiveness in mitigating emissions especially for emerging economies.…”

“…Wolde-Rufael and Mulat-Weldemeskel [ 23 ] explored the effect of environmental policy stringency on CO 2 emissions in Brazil, Russia, India, Indonesia, China, Turkey and South Africa over the 1993–2014 period through panel pooled mean group autoregressive distributive lag estimator and discovered an inverted U-shaped interaction between CO 2 emissions and environmental policy stringency. Same authors [ 17 ] analyzed the effect of environmental policy stringency and environmental tax on CO 2 emissions in seven emerging countries over the 1994–2015 duration through an augmented mean group estimator and discovered a U-shaped interaction between environmental policy stringency and CO 2 emissions and unilateral causality from the environmental policy stringency index and total environmental tax to CO 2 emissions. Furthermore, they found that total environmental tax and energy taxes negatively affected the CO 2 emissions, but no significant causality was discovered among energy and CO 2 taxes and CO 2 emissions.…”

“…Urgent measures and actions are still needed on a global scale, but also, studies that investigate their impact on CO 2 emissions are necessary. Since environmental policy stringency and environmental taxes are considered the main policy instruments for fighting against environmental degradation [ 17 ] and there is a lack of studies on this issue, we focused our research on the relationship between environmental stringency policies and CO 2 emissions. Additionally, we considered it appropriate to focus attention on human development based on the fact that usually, countries’ level of development influence the demand for products and services that in turn will influence the CO2 emissions.…”

The Asymmetric Effect of Environmental Policy Stringency on CO2 Emissions in OECD Countries

“…Albulescu et al 2020;Hashmi and Alam 2019;Ma et al 2018;Niedertscheider et al 2018;Wenbo and Yan 2018;Zhao et al 2015). A portion of these works (Wang et al 2020a;Wolde-Rufael and Mulat-Weldemeskel 2021) investigate the effectiveness of environmental policy stringency in reducing CO2 emissions. Stringency is associated with a specific pollution price imposed by environmental policies.…”

“…with non-market-based policies (standards and limitations, research and development expenditures, etc.). 3 While Wang et al (2020a) investigated the EPSI's impact on air pollution, with a focus on different dimensions of air pollution in 23 OECD countries from 1990 to 2015, more recently Wolde-Rufael and Mulat-Weldemeskel (2021) have tested the U-shaped relationship between CO2 emissions and EPSI for a set of seven emerging economies.…”