TY  - JOUR
AU  - Grainger,Corbett A.
AU  - Kolstad,Charles D.
TI  - Who Pays a Price on Carbon?
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 15239
PY  - 2009
Y2  - August 2009
UR  - http://www.nber.org/papers/w15239
L1  - http://www.nber.org/papers/w15239.pdf
N1  - Author contact info:
Corbett A. Grainger
Department of Agricultural and Applied Economics
University of Wisconsin, Madison
429 Taylor Hall
427 Lorch St.
Madison, WI 53706
http://www.aae.wisc.edu/cagrainger
Tel: 608-262-3651
E-Mail: cagrainger@wisc.edu

Charles D. Kolstad
Department of Economics
University of California
Santa Barbara, CA 93106
Tel: 805/893-2108
Fax: 805/893-8830
E-Mail: kolstad@econ.ucsb.edu
AB  - We use the 2003 Consumer Expenditure Survey and emissions estimates from an input-output model to estimate the incidence of a price on carbon induced by a cap-and-trade program or carbon tax in the US context. We present results on how much difference income deciles pay for a carbon tax as well as which industries see the largest increase in costs due to a carbon tax.  We illustrate the main determinant of the regressivity: consumption patterns for energy-intensive goods. We find that a policy targeting CO2 from energy consumption is more regressive than a price on all emissions. Furthermore, on a per-capita basis a carbon price is much more regressive than calculations at the household level. We discuss policy options to offset the adverse distributional effects of a carbon emissions policy.
ER  -