Climate in the 21st Century<\/a>‘ endeavor therefore offers a new way of funding climate change mitigation and adaptation policies but also the transition to renewable energy through broad-based climate stability bonds-and-taxation mix that also involve future generations (World Bank, 2015). <\/span><\/p>\nHaving shed light on the gains of a warming earth demands for the redistribution of climate change benefits to those areas of the world that will be losing from a warming earth. In the implementation, a climate change bonds but also taxation strategies are recommended. Having found that there are gains from a warming earth demands to transfer benefits into areas of the world that will be primarily losing from climate change. In order to avoid governmental expenditure on climate change hindering economic growth (Barro, 1990); the climate transfers should be enacted through bonds and taxes.<\/span><\/p>\n First Jeffrey Sachs (2014) proposed an intergenerational burden sharing idea by presenting a 3-model climate change burden sharing through fiscal policy with bond issuing in order to reflect the implementation regarding contemporary finance and growth models with respect for maximizing utility of the model. In an overlapping-generations type model, research should elucidate climate change abatement and mitigation policies to lead to a fairer solution across generations.\u00a0 The current generation mitigates climate change and provides infrastructure against climate risk financed through climate bonds to be paid by future generations.\u00a0 Since for future generations the currently created externalities from economic activities \u2013 the effects of C02 emissions \u2013 are removed, this entails that the current generations remain financially as well off as without mitigation while improving environmental well-being of future generations. As Sachs (2014) shows, this intergenerational tax-and-transfer policy turns climate change mitigation and adaptation policy into a Pareto improving strategy.\u00a0 Shifting the costs for climate abatement to the recipients of the benefits of climate stability appears as novel, feasible and easily-implementable solution to nudge many overlapping generations towards future-oriented loss aversion in the sustainability domain (Puaschunder, 2016a).<\/span><\/p>\nOne of the most prominent forms to create revenues for public long-term investment causes are taxes. Taxation is codified in all major societies and a hallmark of democracy. Aimed at redistributing assets to provide public goods and ensure societal harmony, taxation improves societal welfare and fairness notions within society. Tax compliance is a universal phenomenon based on cooperation in the wish for improving the social compound.\u00a0 Taxpayers voluntarily decide to what extent to pay or avoid tax that limit the personal freedom.\u00a0 In a social dilemma, individual interests are in conflict with collective goals. From a myopic economic perspective, the optimal strategy of rational individuals would be to not cooperate and thus evade tax.\u00a0 Short-term the single civilian tax contribution does not make a significant difference in the overall maintenance of public goods \u2013 if only a few taxpayers evade taxes, public goods will not disappear or be reduced.\u00a0 But if a considerable number of taxpayers do not contribute to tax over time, common goods are not guaranteed and ultimately everyone will suffer from suboptimal societal conditions (Dawes, 1980; Stroebe & Frey, 1982; Puaschunder, 2015a).\u00a0 Contemporary economic research has focused on costs and risks of tax evasion (Tyler & De Cremer, 2006).\u00a0 Coercive means \u2013 such as audits and fines \u2013 were found to crowd out tax morale and ultimately result in greater non-compliance as people feel controlled and not being trusted (Cialdini, 1996; Feld & Frey, 2002; Frey, 1992; Hasseldine, 1998).\u00a0 In the last decade, researchers have started to recognize the importance of incorporating morals and social dynamics in economic theory on tax behavior (Andreoni, Erard & Feinstein, 1998). When analyzing tax behavior, recently behavioral economics insights have drawn attention to social influences (Puaschunder, 2015a).<\/span><\/p>\nBehavioral economists widen the lens of incorporating sociological and socio-psychological notions of fairness stemming from social comparisons regarding tax burdens could be positive drivers of tax compliance to overcome the \u2018burden of taxes\u2019 and associations of losses.\u00a0 The cases of voluntary, self-chosen tax ethics and situational influences on social tax compliance norms have just recently been covered by behavioral approaches towards public administration.\u00a0 In general, social comparisons determine social norms that define internalized standards how to behave.\u00a0 Yet internalized social norms are based on comparisons with others that may determine tax morale (Frey, 1997; Mumford, 2001; Schm\u00f6lders, 1960).\u00a0 Social norms elicit concurring behavior when taxpayers identify with the goals of a group but also if they feel being treated in a fair manner by that group.\u00a0 Social fairness considerations in a tax reference group may further taxpayer compliance.\u00a0 Fairness is believed to decrease egoistic utility maximization leveraging trust and reciprocity as interesting social norms building factors (Kirchler, 2007).\u00a0 Social perceptions of fairness as underlying social norms are therefore potential tax ethics nudges.\u00a0 But psychological facets of fairness for the formation of social norms have been left out.\u00a0 If taxpayers believe that non-compliance is a widespread and socially-accepted, then it is more likely that they will not comply as well.\u00a0 Non-compliance may stem from the notion of unfairness in how the tax burden is weighted heavier on some parts of society.<\/span><\/p>\nThe respective bonds-and-tax climate stability financing strategy therefore proposes to bear the burden of climate in a right, just and fair way around the globe.\u00a0 In the climate change winner countries, taxation should become the main driver over financing climate stability strategies.\u00a0 Foremost, the industries winning from a warming climate should be taxed.\u00a0 The Winner-Loser-index is based on the cardinal temperatures for all GDP contributing sectors.\u00a0 Based on the cardinal temperatures for the three GDP components agriculture, industry and service, the taxation should be enacted for those sectors having most time ahead.\u00a0 The rational is that these sectors will be gaining the most from a warming earth and will therefore be flourishing.<\/span><\/p>\nThe taxation models should aid to share the burden of climate change within society in a fair way.\u00a0 Regarding concrete climate taxation strategies, a carbon tax on top of the existing tax system should be used to reduce the burden of climate change and encourage economic growth through subsidies (Chancel & Piketty, 2015).\u00a0 Within a country, high and low income households should face the same burden of climate stabilization adjusted for their disposable income.\u00a0 First, climate justice within a country should pay tribute to the fact that low- and high income households share the same burden proportional to their dispensable income, for instance enabled through a progressive carbon taxation.\u00a0 Those who caused climate change could be regulated to bear a higher cost through carbon tax in combination with retroactive billing through inheritance tax.\u00a0 But also developed and underdeveloped countries as well as various overlapping generations are affected differently.\u00a0 Besides progressive taxation schemes to imbue a sense of fairness in climate change burden sharing, inheritance taxation is also a flexible means to reap past wealth accumulation, which potentially caused environmental damage.\u00a0 The burden of climate change mitigation and adaptation could also be allocated in a fair way within society through contemporary inheritance tax in order to reap benefits of past wealth accumulation.\u00a0 <\/span><\/p>\nIn addition, finding the optimum balance between consumption tax adjusted for disposable income through a progressive tax scheme will aid to unravel drivers of tax compliance in the sustainability domain.\u00a0 If climate taxation is perceived as fair and just allocation of the climate burden, this could convince tax payers to pay one\u2019s share.\u00a0 A novel \u2018service-and-client\u2019 atmosphere could promote taxpayers as cooperative citizens who are willing to comply if they feel their share as fair contribution to the environment.\u00a0 Taxpayers as cooperative citizens would then be willing to comply voluntarily following the greater goal to promote taxpayer collaboration and enhance tax morale in the environmental domain.\u00a0 International comparisons of tax behavior also reveal tax norms being related to different stages of institutional development of the government, which is an essential consideration in sharing the climate change burden in a fair manner between countries.\u00a0 A completely novel approach is to shed light on the benefits of a warming earth in order to derive fair climate gains distribution strategies around the world (Puaschunder, 2017).<\/span><\/p>\n![](\"http:\/\/blogs.cuit.columbia.edu\/jmp2265\/files\/2017\/05\/Climate_Change_and_Winners-1-1024x769.jpg\")
<\/p>\n
Graph 2: Climate Change Winners weighted by GDP\/capita<\/span><\/p>\n","protected":false},"excerpt":{"rendered":" Graph 1: Overall climate change winners The implementation of climate stability accounts for the most challenging contemporary global governance predicament that seems to pit world countries but also today\u2019s generation against future world inhabitants. In a trade-off of economic growth versus sustainability, a broad-based international coalition could establish climate stability. As a novel angle […]<\/p>\n","protected":false},"author":5778,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"page-full-width.php","meta":[],"_links":{"self":[{"href":"https:\/\/blogs.cuit.columbia.edu\/jmp2265\/index.php?rest_route=\/wp\/v2\/pages\/48"}],"collection":[{"href":"https:\/\/blogs.cuit.columbia.edu\/jmp2265\/index.php?rest_route=\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/blogs.cuit.columbia.edu\/jmp2265\/index.php?rest_route=\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.cuit.columbia.edu\/jmp2265\/index.php?rest_route=\/wp\/v2\/users\/5778"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.cuit.columbia.edu\/jmp2265\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=48"}],"version-history":[{"count":13,"href":"https:\/\/blogs.cuit.columbia.edu\/jmp2265\/index.php?rest_route=\/wp\/v2\/pages\/48\/revisions"}],"predecessor-version":[{"id":110,"href":"https:\/\/blogs.cuit.columbia.edu\/jmp2265\/index.php?rest_route=\/wp\/v2\/pages\/48\/revisions\/110"}],"wp:attachment":[{"href":"https:\/\/blogs.cuit.columbia.edu\/jmp2265\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=48"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
![](\"http:\/\/blogs.cuit.columbia.edu\/jmp2265\/files\/2017\/05\/Winners_Large.jpg\")
<\/p>\n