Scandinavian Working Papers in Economics

Working Papers,
Swedish National Road & Transport Research Institute (VTI)

No 2024:8: The effect of information on public support for increased carbon taxes on transport fuels

Roger Pyddoke (), Emma From (), Gunilla Björklund () and Henrik Andersson ()
Additional contact information
Roger Pyddoke: Swedish National Road and Transport Research Institute (VTI), Postal: VTI, Dept. of Transport Economics, P.O. Box 55685, SE-102 15 Stockholm, Sweden
Emma From: Swedish National Road and Transport Research Institute (VTI), Postal: VTI, Dept. of Transport Economics, P.O. Box 55685, SE-102 15 Stockholm, Sweden
Gunilla Björklund: Swedish National Road and Transport Research Institute (VTI), Postal: VTI, Dept. of Transport Economics, P.O. Box 55685, SE-102 15 Stockholm, Sweden
Henrik Andersson: Swedish National Road and Transport Research Institute (VTI), Postal: VTI, Dept. of Transport Economics, Bruksgatan 8, SE-222 36 Lund, Sweden

Abstract: This study examines how information about the effects of increased fuel taxes on fuel consumption, and with the possibility of compensating rural inhabitants (who use their cars more), impact the acceptance of fuel taxes and the psychological nature of the acceptance. Using a stratified survey in Sweden we analyze the support for increased carbon taxes for fuels. We find that 16 to 27 percent of the respondents support the proposed policy. A prime reason for this low support appears to be that most Swedes do not believe that higher fuel prices through taxation will lead to lower CO2 emissions from road transport. Equity concerns have also been shown to be a major objection against such tax increases, with a strong correlation between equity concerns and non-support for the tax increase. Our results suggest that neither information about the expected effect from taxation on emissions, nor the potential for redistribution, had an effect on the support for the taxes. When controlling for treatment, socioeconomic variables and demographic variables, the psychological variables showed that the respondents willing to support the increased fuel tax also had a positive attitude towards the tax, and a strong belief of their capacity to perform the behavior, and also a belief that supporting the tax is up to them.

Keywords: Climate; Fuel tax; Pigouvian mechanism; Equity; Public support; Acceptance

JEL-codes: D72; D91; Q54

Language: English

39 pages, November 29, 2024

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