Charalampidis, N., "Green Tax Pass-Through to Retail Fuel Prices and Firm Heterogeneity: Evidence from France"

Title: "Green Tax Pass-Through to Retail Fuel Prices and Firm Heterogeneity: Evidence from France"

Speaker: Associate Professor Nikolaos Charalampidis, University of Laval

Host:  Assistant Professor Kospentaris Ioannis, Department of Economics, Athens University of Economics and Business

Time: 15.30 -17.00

Room:  76, Patission Str., Antoniadou Wing, 3rd floor, Room A36

Abstract:  Combining a natural experiment and high-frequency information on retail fuel prices, we investigate the level, dynamic, heterogeneity, and dependence of the pass-through of a green tax. The green tax’s economic incidence falls largely on consumers but with significant heterogeneity across gas stations. The magnitude and speed of pass-through vary between 84% and 100%, and two and eleven days, respectively, with gas stations affiliated with the low-price branch of oil companies and supermarkets passing the tax more and faster than gas stations affiliated with the ordinary branch of oil companies. Firm differences in the frequency of price changes that we uncover in the data explain more than two-thirds of the heterogeneous tax pass-through according to a dynamic model that also suggests an influence of strategic complementarities.