IRENE Working Paper 20-11 Beyond political divides: Analyzing public opinion on carbon taxation in Switzerland Laurent Ott, Mehdi Farsi, and Sylvain Weber Beyond political divides: analyzing public opinion on carbon taxation in Switzerland* Laurent Ott Mehdi Farsi Sylvain Weber§ November 16, 2020 Abstract This paper investigates public opinion on the Swiss CO2 levy and its 2020 revision by using a discrete choice experiment answered by a sample of 586 respondents living in Switzerland. The ex- periment is designed to elicit citizen preferences among various taxation attributes and is followed by a referendum voting experiment on various CO2 levy proposals. Based on latent class modeling approaches, we find that the population is composed by two distinct but relatively preference pro- files: Environmentalists and Neutrals. Respondents belonging to the first group tend to favor higher carbon tax rates and a redistribution of proceeds benefiting low-income individuals, whereas those in the second group prefer lower rates and a uniform redistribution of proceeds across all taxpayers. Findings from the voting experiment point to a general support among the Environmentalists, but an uncertain approval from the Neutral group. Keywords: Carbon tax, preference heterogeneity, public opinion, latent class, discrete choice exper- iment JEL classification: C25, D72, D78, H23, Q48, Q54 *This research is part of the activities of SCCER CREST (Swiss Competence Center for Energy Research), which is financially supported by Innosuisse under Grant No. KTI. 1155000154. University of Neuch^atel,Institute of economic research, Abram-Louis Breguet 2, 2000 Neuch^atel,Switzerland.
[email protected] University of Neuch^atel,Institute of economic research.