Finance - Policy Interactions in Climate Management: How Policy Stringency Enhances the Impact of Carbon Taxation?

Authors : Kağan Okatan

Pages : 262-278

Doi:10.33203/mfy.1829167

View : 55 | Download : 154

Publication Date : 2025-12-31

Article Type : Research Paper

Abstract :This paper examines the effects of national stringency of policies on the effectiveness of carbon taxes in mitigating CO₂ emissions, combining the theories of climate finance and the management of public policies. Based on a 26-country unbalanced panel dataset from 1990 to 2020, the fixed-effects method is employed to examine the independent and moderating roles of the stringency of climate policies as measured by the CPSI. This analysis shows that while carbon taxes are effective in lowering CO₂ emissions per capita, higher scores in the CPSI are an independent factor in this process. More importantly, the interaction term is negative and statistically significant, thus providing conclusive evidence that in climates that strictly regulate policies, the marginal effect of carbon taxes further advances the cause of mitigation.
Keywords : Karbon Vergisi, İklim Politikası Sıkılığı, İklim Finansmanı, Çevre Yönetimi

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