@article {1154070, title = {Carbon taxes and the double dividend hypothesis in a recursive-dynamic CGE model for Spain}, journal = {Economic Systems Research}, volume = {31}, year = {2019}, pages = {267-284}, abstract = {A carbon tax is potentially a policy that can reduce CO2 emissions and mitigate climate risks, at lowest economy-wide costs. We develop a dynamic CGE model for Spain to assess the economic and environmental effects of a carbon tax, and test the double dividend (DD) hypothesis. We simulate the impact of three carbon taxes: {\texteuro}10, {\texteuro}20 and {\texteuro}30 per ton of CO2. For each tax, four {\textquoteleft}revenue recycling{\textquoteright} scenarios are examined: a reduction of taxes on capital, on labor, on value-added tax, and a scenario in which revenues are not recycled. We find a DD for taxes of {\texteuro}10/ton and lower, within five to seven years of implementation. We estimate an annual CO2 emissions reduction of around 10\% with this tax. Under some circumstances, the DD can be achieved for a tax of {\texteuro}20/ton. In any case, recycling revenues to cut pre-existing taxes reduces costs of imposing carbon taxes.}, url = {https://www.tandfonline.com/doi/full/10.1080/09535314.2019.1568969}, author = {Jaume Freire-Gonz{\'a}lez and Ho, Mun S.} }