Carbon pricing to reduce Europe’s fiscal deficits
An overriding challenge for many European governments and policy-makers is to reduce major fiscal deficits with the least collateral damage to their economy. This paper aims to clarify the role carbon-related fiscal measures can play in contributing to fiscal re-balancing in Europe. It builds on a broader report carried out by Vivid Economics for the European Climate Foundation and Green Budget Europe, which includes a detailed assessment and modelling of the issue. This paper provides an overview of the analysis in the report, and extracts key messages for policy-makers.
Date: November 2012