RFI paper, The Initial Incidence of a Carbon Tax across Income Groups

Resources for the Future’s 2014 discussion paper, The Initial Incidence of a Carbon Tax across Income Groups, links dynamic models of the United States to estimate the initial incidence of a carbon tax. It finds that while carbon taxes are regressive, the incidence depends much more on how carbon tax revenue is used. It reviews options including recycling revenues, lump-sum rebates, and a labor tax swap.