Epsilon Archive for Student Projects

Abstract

Internalizing the Social Cost of Carbon (SCC) into the price of fish is a requisite action considering Sweden’s obligations under the Paris Agreement. However, bluntly taxing all seafood may conflict with Swedish authorities’ dietary recommendations. Therefore, this study investigates three different tax/subsidy policy scenarios’ efficacy at achieving reduced Greenhouse Gas (GHG) emissions whilst increasing compliance with public dietary recommendations. Taxes internalize products’ SCC, particularly bottom trawled fish, and the subsidy at 12 percent applies to less harmful eco-labelled fish to increase dietary recommendations’ fulfilment. Swedish consumers’ price sensitivity is analysed using eight seafood commodity groups in a Quadratic Almost Ideal Demand System applied to 243 days of scanner data. Increased compliance with dietary recommendations comes at the expense of less GHG emissions. Nonetheless, a ‘one-fell-swoop’ outcome is not rendered infeasible.