Research

Working papers

Pollution versus inequality: tradeoffs for fiscal policy,  with Thomas Seegmuller.  Revise & Resubmit at Macroeconomic Dynamics. 

Abstract: In this paper, we investigate the impact of redistribution and polluting commodity taxation on inequality and pollution in a dynamic setting. We build a two-sector Ramsey model with a green and a polluting good, with two types of households and a level of subsistence consumption for the polluting commodity. Increasing the tax rate on polluting consumption has an ambiguous effect on pollution depending on the level of subsistence consumption. A low level allows to reduce pollution, while a high level of leads to higher emissions because of an incompressible income effect. Looking at the stability properties of the economy, a high subsistence level of polluting consumption leads to instability or indeterminacy of the steady state, while the environmental externality reduces the scope for indeterminacy. Increasing the tax rate and redistributing more towards workers promotes the occurrence of indeterminacy and instability. Considering the subsistence level of consumption is hence of importance as it shapes the efficiency of the environmental fiscal policy in the long-run and stability of the economy in the shorter run.  

Presentation: FIRE Workshop 2021 (Marseille, France),  ASSET Conference 2021 (Marseille, France),  AMSE PhD Seminar (Online), LORDE Workshop 2022 (Rouen, France), ICMAIF 2022 (Rethymno, Crete), SURED 2022 (Ascona, Switzerland), EAERE 2022 (Rimini, Italy), FAERE 2022 (Rouen, France)

Work in progress

Taxing incognito: optimal climate policy and inequality (Job Market Paper). Draft available soon.

Abstract:  This paper explores optimal alternatives to carbon taxation using already existing taxes in the economy and their impact on inequality. I build a two-sector Ramsey model with heterogeneous agents and a climate component, in which climate damages harm the final good sector’s productivity and individual utility through temperature changes. I find that there exists an alternative to the standard carbon tax, both in a first- and second-best setting. Under this alternative, the carbon tax on emissions is replaced by a tax on total energy production and a subsidy to abatement. Studying the optimal Ramsey fiscal policy, all taxes become non-zero, because of heterogeneity among households and because energy consumption is not taxed as emissions are. When a tax carbon is not implementable, it is replaced by a subsidy on abatement and an increase in the excise tax on energy production. Keeping the alternative fiscal policy on the production side has no impact on inequality.

Presentation: AMSE PhD Seminar 2023 (Marseille, France), LORDE Workshop 2023 (Paris, France), CORE Brownbag Seminar (UCLouvain), SEEMS Seminar (UvA), LAGV 2023 (Marseille, France), ASSET 2023 (Lisbon, Portugal)

Educational policies towards the environment