Program and Development Research

Program and Development Research

Analyzing the Role of Carbon Tax in the Impact of Oil Rent on the Ecological Footprint in Iran

Document Type : Original Article

Authors
Bahare Baghaeipour 1
Morteza Sameti 2
Teymour Mohammadi 3
1 PhD student in Economics, Department of Economics, SR.C., Islamic Azad University, Tehran, Iran.
2 Retired Professor of Economics, Isfahan University, Isfahan, Iran.
3 Professor of Economics, Department of Economics, Faculty of Economics, Allameh Tabataba’i University.
10.22034/pbr.2025.541029.1570
Abstract
The consumption of fossil fuels and the overexploitation of natural resources such as oil have led to environmental degradation, highlighting the importance of finding solutions to prevent it. Carbon tax is an economic tool that can internalize the external costs of carbon emissions, creating incentives to reduce environmental damage. The aim of this article is to analyze the role of carbon tax in the impact of oil rents on the ecological footprint in Iran during the period 1996–2023. The research variables’ data were extracted from reliable statistical websites, and the carbon tax was calculated by multiplying the per capita CO2 emissions by 80,000 rials. The smooth transition regression method, based on selecting the transition variable from independent variables, determining its threshold, and creating different regimes for variable effects, was used. The results showed that the two-period lagged carbon tax was the transition variable with a threshold of 0.78, and two threshold regimes exist. Carbon tax and information and communication technology had a negative effect on the ecological footprint in both regimes, with the effect strengthened in the second regime. Oil rents had a positive effect on the ecological footprint in both regimes, but this effect was weakened in the second regime. Population had a positive effect on the ecological footprint in both regimes, but this effect was attenuated in the second regime. Since reaching the carbon tax threshold reduces the impacts of factors increasing the ecological footprint and enhances the effects of those reducing it, the implementation of effective carbon tax policies and the targeted allocation of revenues toward the development of clean energy and improvement of environmental infrastructure are recommended.
Keywords
Carbon tax
oil rent
ecological footprint
smooth transition regression

Subjects

 
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