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Frequently, hope is expressed that a revenue-neutral ecological tax reform may serve as a remedy for both unemployment and pollution. The idea is to recycle the proceeds from green taxes by cutting taxes on labour, thus boosting employment while discouraging polluting activities. We investigate...
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With direct trade barriers banned, governments may be tempted to use indirect policy tools to interfere with trade, such as environmental taxes. The author uses a model of an endogenous market structure, where the number of firms is determined by a zero-profit condition in one country but is...
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