Analyzing the Effects of the Swiss Carbon Tax on Carbon Emissions from the Energy Sector | Ansar Mirza

Switzerland has shown to increase its carbon tax rate at a rapid speed. This paper evaluates the effect of the Swiss carbon tax on carbon emissions in the energy sector by using panel data of select countries in the OECD. My experiments consist of difference-in-difference (DiD) regressions and synthetic control methods (SCMs) to assess the causal effect of carbon tax on energy carbon emissions. The SCM method provides evidence that the tax implementation decreased emissions from less than 1% a year after treatment to a 20% decrease in emissions at the end of the post-treatment period. This evidence suggests a negative causality of carbon tax on carbon emissions in the energy sector. My paper contributes to the small pool of carbon tax ex-post literature.

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