| Abstract: |
The aim of the thesis is to outline the main ideas in the development of the optimal environmental taxation theory and explain its connection to the double dividend hypothesis. Moreover, conditions under which the strong form of the double dividend holds are discussed. We conclude that the degree of substitution within consumption bundle as well as between polluting commodity and leisure is a fundamental factor for the validity of the strong double dividend and for the optimal level of environmental tax. Furthermore, a computable general equilibrium model is employed to assess outcomes of various tax reform policies and to test theoretical conclusions. |
