Do energy taxes reduce the carbon footprint? Evidence from Turkey

Year 2021, Volume: 6 Issue: 2, 179 - 186, 30.12.2021

Ömer Esen , Miray Dündar

Abstract

This study examines the effect of energy taxes on the carbon footprint in Turkey using the data set for 1994-2017. Johansen cointegration tests were used in this study to analyze the existence of a long-term relationship between the variables. Moreover, the estimation methods “dynamic ordinary least squares” (DOLS) and “fully modified ordinary least squares” (FMOLS) were applied to determine the long-term cointegration coefficients. The results of the Johansen cointegration analysis confirm that there is a long-term cointegration relationship between the variables. In addition, the results of DOLS and FMOLS show that an increase in energy taxes reduces the carbon footprint in the long term. In conclusion, the results of the study suggest that environmental taxes can be used as an effective alternative policy tool to achieve certain environmental quality standards. In addition, the results provide evidence that such taxes can influence costs and, by doing so, have an effect on the economic decision units’ habits of environmentally harmful production and consumption.

Keywords

Energy Taxes, Carbon Footprint, Turkey

Enerji vergileri karbon ayak izini azaltır mı? Türkiye'den kanıtlar

Abstract

Bu çalışma, 1994–2017 dönemi Türkiye veri setini kullanarak enerji vergilerinin karbon ayak izi üzerindeki etkisini incelemektedir. Bu çalışmada, değişkenler arasındaki uzun dönemli bir ilişkinin varlığını analiz etmek için Johansen eş-bütünleşme testleri kullanılmaktadır. Ayrıca, uzun dönem eş bütünleşme katsayılarını belirlemek için dinamik en küçük kareler (DOLS) ve tam düzeltilmiş en küçük kareler (FMOLS) tahmin yöntemleri uygulanmaktadır. Johansen eş bütünleşme analizinden elde edilen bulgular, değişkenler arasında uzun dönemli bir eş bütünleşme ilişkisinin olduğunu doğrulamaktadır. Ayrıca, DOLS ve FMOLS sonuçları, enerji vergilerinde meydana gelen bir artışın uzun vadede karbon ayak izini azalttığını ortaya koymaktadır. Bulgular, çevresel vergilerin belirli çevre kalite standartlarına ulaşmak için etkili birer alternatif politika aracı olarak kullanılabileceğini göstermektedir. Ayrıca, bu tür vergilerin maliyetleri etkilemek suretiyle ekonomik karar birimlerinin çevreye zararlı üretim ve tüketim alışkanlıkları üzerinde etkili olabildiğine dair kanıtlar sunmaktadır.

Keywords

Enerji Vergileri, Karbon Ayak İzi, Türkiye

References

• Agostini, P., Botteon, M., & Carraro, C. (1992). A carbon tax to reduce CO2 emissions in Europe. Energy Economics, 14(4), 279-290. https://doi.org/10.1016/0140-9883(92)90034-B
• Akkaya, Ş., & Hepsag, A. (2021). Does fuel tax decrease carbon dioxide emissions in Turkey? Evidence from an asymmetric nonlinear cointegration test and error correction model. Environmental Science and Pollution Research, 1-8. https://doi.org/10.1007/s11356-021-12907-9
• Alfsen, K. H., Birkelund, H., & Aaserud, M. (1995). Impacts of an EC carbon/energy tax and deregulating thermal power supply on CO2, SO2 and NOx emissions. Environmental and Resource Economics, 5(2), 165-189. https://doi.org/10.1007/BF00693022
• Andersson, J. (2015). Cars, carbon taxes and CO2 emissions. Centre for Climate Change Economics and Policy Working Paper WP No. 238. London: Grantham Research Institute on Climate Change and the Environment. (Accessed on 14.05.2021), http://re.indiaenvironmentportal.org.in/files/file/Cars%2C%20carbon%20taxes%20and%20CO2%20emissions.pdf
• Aydin, C., & Esen, O. (2017). The validity of the environmental Kuznets curve hypothesis for CO2 emissions in Turkey: new evidence from smooth transition regression approach. Mustafa Kemal University Journal of Social Sciences Institute, 14(39), 101-116.
• Aydin, C., & Esen, Ö. (2018). Reducing CO2 emissions in the EU member states: Do environmental taxes work?. Journal of Environmental Planning and Management, 61(13), 2396-2420. https://doi.org/10.1080/09640568.2017.1395731
• Aydin, C., & Onay, R. D. (2020). Does Energy Intensity Affect the Relationship Between Financial Development and Environmental Pollution?. Broad Research in Artificial Intelligence and Neuroscience, 11(1), 144-156. http://dx.doi.org/10.18662/brain/11.1/20
• Aydin, C., Darici, B., & Kutlu, Ş. Ş. (2019). Does Economic Growth Reduce Environmental Pollution?. Anemon Journal of Social Sciences of Mus Alparslan University, 7(2), 191-196. https://doi.org/10.18506/anemon.459157
• Aydin, C., Esen, Ö., & Aydin, R. (2019). Is the ecological footprint related to the Kuznets curve a real process or rationalizing the ecological consequences of the affluence? Evidence from PSTR approach. Ecological indicators, 98, 543-555. https://doi.org/10.1016/j.ecolind.2018.11.034
• Aydin, M. (2020). Seçilmiş OECD ülkelerinde çevre vergilerinin çevre kirliliği üzerindeki etkileri: yapısal kırılmalı nedensellik testinden kanıtlar. Uluslararası İktisadi ve İdari İncelemeler Dergisi, (28), 137-154. https://doi.org/10.18092/ulikidince.704936
• Bruvoll, A., & Larsen, B. M. (2004). Greenhouse gas emissions in Norway: do carbon taxes work?. Energy policy, 32(4), 493-505. https://doi.org/10.1016/S0301-4215(03)00151-4
• Chen, W., Zhou, J. F., Li, S. Y., & Li, Y. C. (2017). Effects of an energy tax (carbon tax) on energy saving and emission reduction in Guangdong province-based on a CGE model. Sustainability, 9(5), 681.https://doi.org/10.3390/su9050681
• Esen, O. (2012). The effect of exchange rate uncertainty on exports in Turkey. Finans Politik ve Ekonomik Yorumlar, (568), 89-89.
• Esen, Ö., Yıldırım, D. Ç., & Yıldırım, S. (2021). Pollute less or tax more? Asymmetries in the EU environmental taxes–Ecological balance nexus. Environmental Impact Assessment Review, 91, 106662. https://doi.org/10.1016/j.eiar.2021.106662
• Gemechu, E. D., Butnar, I., Llop, M., & Castells, F. (2014). Economic and environmental effects of CO2 taxation: an input-output analysis for Spain. Journal of Environmental Planning and Management, 57(5), 751-768. https://doi.org/10.1080/09640568.2013.767782
• Gerlagh, R., & Lise, W. (2005). Carbon taxes: a drop in the ocean, or a drop that erodes the stone? The effect of carbon taxes on technological change. Ecological Economics, 54(2-3), 241-260. https://doi.org/10.1016/j.ecolecon.2004.12.037
• GFN (2021). Ecological Footprint database. (Accessed on 01.05.2021), https://data.footprintnetwork.org/
• Gujarati, D. N. (1995). Basic Econometrics. New York: McGraw Hill.
• Gündüz, İ. O. (2013). Bir Çevre Vergisi Türü Olarak Enerji Vergisi: Fosil Yakıtların Vergilendirilmesi-I. Çukurova Üniversitesi Sosyal Bilimler Enstitüsü Dergisi, 22(2), 111-125.
• Hotunluoğlu, H., & Tekeli, R. (2007). Karbon vergisinin ekonomik analizi ve etkileri: karbon vergisinin emisyon azaltıcı etkisi var mı?. Sosyoekonomi, 6(6), 107-125.
• Johansen, S. (1988). Statistical analysis of cointegration vectors. Journal of economic dynamics and control, 12(2-3), 231-254. https://doi.org/10.1016/0165-1889(88)90041-3
• Johansen, S. (1995). Likelihood-based inference in cointegrated vector autoregressive models. New York: Oxford University Press.
• Lin, B., & Li, X. (2011). The effect of carbon tax on per capita CO2 emissions. Energy policy, 39(9), 5137-5146. https://doi.org/10.1016/j.enpol.2011.05.050
• Lin, B., & Li, X. (2011). The effect of carbon tax on per capita CO2 emissions. Energy policy, 39(9), 5137-5146. https://doi.org/10.1016/j.enpol.2011.05.050
• Lin, Z., & Brannigan, A. (2003). Advances in the analysis of non-stationary time series: An illustration of cointegration and error correction methods in research on crime and immigration. Quality and Quantity, 37(2), 151-168. https://doi.org/10.1023/A:1023367205756
• Loganathan, N., Shahbaz, M., & Taha, R. (2014). The link between green taxation and economic growth on CO2 emissions: fresh evidence from Malaysia. Renewable and Sustainable Energy Reviews, 38, 1083-1091. https://doi.org/10.1016/j.rser.2014.07.057
• Lu, C., Tong, Q., & Liu, X. (2010). The impacts of carbon tax and complementary policies on Chinese economy. Energy Policy, 38(11), 7278-7285. https://doi.org/10.1016/j.enpol.2010.07.055
• Manne, A. S., & Richels, R. G. (1990). CO2 emission limits: an economic cost analysis for the USA. The Energy Journal, 11(2), 51–74. https://doi.org/10.5547/ISSN0195-6574-EJ-Vol11-No2-3
• Miller, S., & Vela, M. (2013). Are environmentally related taxes effective?. IDB Working Papers, WP. No. IDB-WP-467. https://dx.doi.org/10.2139/ssrn.2367708
• Nakata, T., & Lamont, A. (2001). Analysis of the impacts of carbon taxes on energy systems in Japan. Energy Policy, 29(2), 159-166. https://doi.org/10.1016/S0301-4215(00)00104-X
• Nanthakumar, L., Shahbaz, M., & Taha, R. (2014). The effect of Green Taxation and Economic Growth on Environment Hazards: The Case of Malaysia. MPRA Paper 1–16. Munich, Germany: University Library of Munich. (Accessed on 14.05.2021), http://mpra.ub.uni-muenchen.de/56843/.
• Niu, T., Yao, X., Shao, S., Li, D., & Wang, W. (2018). Environmental tax shocks and carbon emissions: An estimated DSGE model. Structural Change and Economic Dynamics, 47, 9-17. https://doi.org/10.1016/j.strueco.2018.06.005
• OECD (2021). Environment Statistics (database). (Accessed on 01.05.2021), https://data.oecd.org/envpolicy/environmental-tax.htm
• Rees, W. E. (1992). Ecological footprints and appropriated carrying capacity: what urban economics leaves out. Environment and Urbanization, 4(2), 121-130.
• Rees, W. E., & Wackernagel, M. (1994). Ecological footprints and appropriated carrying capacity: measuring the natural capital requirements of the human economy. In: A. Jansson, M. Hammer, C. Folke, R. Costanza (Eds.), Investing in Natural Capital: The Ecological Economics Approach to Sustainability, (pp. 362-390). Washington, DC: Island Press.
• Sasmaz, M. U. (2016). Validity of double dividend hypothesis in EU-15 countries. New Trends and Issues Proceedings on Humanities and Social Sciences, 2(2), 30-36. https://doi.org/10.18844/gjhss.v2i2.412
• Shrestha, M. B., & Bhatta, G. R. (2018). Selecting appropriate methodological framework for time series data analysis. The Journal of Finance and Data Science, 4(2), 71-89. https://doi.org/10.1016/j.jfds.2017.11.001
• Topal, M. H., & Günay, H. F. (2017). Çevre vergilerinin çevre kalitesi üzerindeki etkisi: Gelişmekte olan ve gelişmiş ekonomilerden ampirik bir kanıt. Maliye Araştırmaları Dergisi, 3(1), 63-83. WB (2021). World Development Indicators. (Accessed on 14.05.2021), https://databank.worldbank.org/source/world-development-indicators
• Whalley, J., & Wigle, R. (1991). Cutting CO2 emissions: the effects of alternative policy approaches. The Energy Journal, 12(1), 109–124. https://doi.org/10.5547/ISSN0195-6574-EJ-Vol12-No1-7
• Wissema, W., & Dellink, R. (2007). AGE analysis of the impact of a carbon energy tax on the Irish economy. Ecological economics, 61(4), 671-683. https://doi.org/10.1016/j.ecolecon.2006.07.034
• Wolde-Rufael, Y., & Mulat-Weldemeskel, E. (2021). Do environmental taxes and environmental stringency policies reduce CO2 emissions? Evidence from 7 emerging economies. Environmental Science and Pollution Research, 28, 22392–22408. https://doi.org/10.1007/s11356-020-11475-8
• WWF (2012). Türkiye’nin Ekolojik Ayak İzi Raporu. İstanbul: Ofset Yapımevi. (Accessed on 10.05.2021), http://awsassets.wwftr.panda.org/downloads/turkiyenin_ekolojik_ayak_izi_raporu.pdf