A Study of the Dynamic Structure of Environmental Tax for Pollution Abatement

공해감소를 위한 환경세의 동태적 구조에 관한 연구

In this paper, we present a nonrenewable resource model including environmental pollution stock as a state variable to analyze the dynamic structure of environmental tax. Based on the optimality conditions of our model, we showed that the optimal time path of the shadow cost for environmental pollution stock is the same as that of the costate variable for environmental pollution stock. We did this by applying the theorem, Continuous Dependence on Initial Conditions (Coddington and Levinston, 1985, pp. 22~27), to the optimal control problem. Thus, this result provides a theoretical basis to determine the magnitude of environmental tax to be imposed over time. In addition, we also identified that the costate variable for environmental pollution stock is solely due to the disutility effect.