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Sustainability 2018, 10(7), 2464; https://doi.org/10.3390/su10072464

Efficiency of Energy Taxes and the Validity of the Residential Electricity Environmental Kuznets Curve in the European Union

Faculty of Economics in Osijek, Josip Juraj Strossmayer University of Osijek, Gajev trg 7, HR 31000 Osijek, Croatia
Received: 5 June 2018 / Revised: 9 July 2018 / Accepted: 10 July 2018 / Published: 13 July 2018
(This article belongs to the Section Energy Sustainability)
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Abstract

To achieve the energy targets, energy policy of the European Union (EU) is trying to discourage residential electricity consumption employing different measures but without worsening the quality of life and jeopardizing its economic growth and development at the same time. This paper aims to directly and indirectly explore the effects of energy taxes on household electricity consumption and test the validity of the household electricity environmental Kuznets curve (EEKC) in a multivariate setting and a system generalized method of moments framework for EU member countries in the period 2005–2016. The results reveal that energy taxes influence electricity consumption more efficiently through energy prices than directly and in the long-run. Efficiency of energy taxes can be reinforced by combining changes in energy prices and policy measures that change the electricity consumption behavior patterns. As for the EEKC, the paper corroborates its inverted U-shaped form, assuming thereby at least the same level of policy efforts directed to accomplish the energy targets and household willingness to use goods in an environmentally friendly way. View Full-Text
Keywords: energy taxes; electricity consumption; environmental Kuznets curve; human capital; dynamic panel analysis energy taxes; electricity consumption; environmental Kuznets curve; human capital; dynamic panel analysis
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This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. (CC BY 4.0).
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Borozan, D. Efficiency of Energy Taxes and the Validity of the Residential Electricity Environmental Kuznets Curve in the European Union. Sustainability 2018, 10, 2464.

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