Pigou in the 21st Century: a tribute on the occasion of the 100th anniversary of the publication of The Economics of Welfare

dc.contributor.authorEdenhofer, Ottmar
dc.contributor.authorFranks, Max
dc.contributor.authorKalkuhl, Matthias
dc.date.accessioned2021-12-06T07:39:37Z
dc.date.available2021-12-06T07:39:37Z
dc.date.issued2021-01-19
dc.description.abstractThe year 2020 marks the centennial of the publication of Arthur Cecil Pigou’s magnum opus The Economics of Welfare . Pigou’s pricing principles have had an enduring influence on the academic debate, with a widespread consensus having emerged among economists that Pigouvian taxes or subsidies are theoretically desirable, but politically infeasible. In this article, we revisit Pigou’s contribution and argue that this consensus is somewhat spurious, particularly in two ways: (1) Economists are too quick to ignore the theoretical problems and subtleties that Pigouvian pricing still faces; (2) The wholesale skepticism concerning the political viability of Pigouvian pricing is at odds with its recent practical achievements. These two points are made by, first, outlining the theoretical and political challenges that include uncertainty about the social cost of carbon, the unclear relationship between the cost–benefit and cost-effectiveness approaches, distributional concerns, fragmented ministerial responsibilities, an unstable tax base, commitment problems, lack of acceptance and trust between government and citizens as well as incomplete international cooperation. Secondly, we discuss the recent political success of Pigouvian pricing, as evidenced by the German government’s 2019 climate policy reform and the EU’s Green Deal. We conclude by presenting a research agenda for addressing the remaining barriers that need to be overcome to make Pigouvian pricing a common political practice.en
dc.description.sponsorshipTU Berlin, Open-Access-Mittel – 2021en
dc.identifier.eissn1573-6970
dc.identifier.issn0927-5940
dc.identifier.pmid33495672
dc.identifier.urihttps://depositonce.tu-berlin.de/handle/11303/13977
dc.identifier.urihttp://dx.doi.org/10.14279/depositonce-12750
dc.language.isoenen
dc.rights.urihttps://creativecommons.org/licenses/by/4.0/en
dc.subject.ddc330 Wirtschaftde
dc.subject.othercarbon pricingen
dc.subject.otherclimate change economicsen
dc.subject.othereconomic policyen
dc.subject.otherenvironmental economicsen
dc.subject.otherPigouvian taxationen
dc.titlePigou in the 21st Century: a tribute on the occasion of the 100th anniversary of the publication of The Economics of Welfareen
dc.typeArticleen
dc.type.versionpublishedVersionen
dcterms.bibliographicCitation.doi10.1007/s10797-020-09653-yen
dcterms.bibliographicCitation.issue5en
dcterms.bibliographicCitation.journaltitleInternational Tax and Public Financeen
dcterms.bibliographicCitation.originalpublishernameSpringer Natureen
dcterms.bibliographicCitation.originalpublisherplaceNew York, NYen
dcterms.bibliographicCitation.pageend1121en
dcterms.bibliographicCitation.pagestart1090en
dcterms.bibliographicCitation.volume28en
tub.accessrights.dnbfreeen
tub.affiliationFak. 6 Planen Bauen Umwelt::Inst. Landschaftsarchitektur und Umweltplanung::FG Ökonomie des Klimawandelsde
tub.affiliation.facultyFak. 6 Planen Bauen Umweltde
tub.affiliation.groupFG Ökonomie des Klimawandelsde
tub.affiliation.instituteInst. Landschaftsarchitektur und Umweltplanungde
tub.publisher.universityorinstitutionTechnische Universität Berlinen

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