In this paper we study political-economy determinants of the differentiation of environmental taxes between sectors. Using a common-agency model, we provide predictions on tax differentiation which are then tested using data from the German Ecological Tax Reform. As the reform is revenue neutral...

This paper evaluates alternative options for rebating revenues from a unilateral emissions price, focusing on energy-intensive and trade-exposed industries. A theoretical model is developed to demonstrate that conditional rebating policies---which would be distortionary in a first-best...

In 2003 the Kyoto Protocol, which imposes legally binding greenhouse gas emission constraints on industrialized countries, is likely to enter into force. The Protocol has been celebrated as a milestone in climate protection, but standard economic theory casts doubt that it will go beyond...

In a series of experiments we show that people learn to play the efficient outcome in an open-ended rent-seeking game. This result persists despite quite different experiment environments and designs, like different propensities of competition, group sizes etc., and is interpretable as a...

In this paper, we analyse if individual inequality aversion measured with simple experimental games depends on whether the monetary endowment in these games is either a windfall gain (“house money”) or a reward for a certain effort-related performance. We then examine whether the way of...