The Political Impact of Environmental Economic Ideas

CO₂ taxes on industry increased in the Scandinavian countries over the course of the 1990s, whereas taxation on agricultural emissions of nitrogen stagnated or decreased. Variations between the two policy fields can in part be explained by contrasting ideational viabilities. Two diverging expert communities exist in the agricultural sector: the first is dominated by agricultural scientists, whose analytical vantage point is field production; the other is dominated by economists; whose analytical vantage point comprises overall socio-economic benefits. In the debate between these diverging models of cognition, the taxation of nitrogen is increasingly perceived as inefficient and unfair. Administrative bias and the position in the ministerial hierarchy affect the advice passed on to policy makers. The political viability of nitrogen taxes consequently decreases as politicians hesitate to employ a policy measure that can be cast into doubt on scientific grounds by the political opposition and agricultural organisations. Instead, alternative instruments developed by agricultural scientist are employed. Thus, the interaction between ideas and interests can contribute to our understanding of why the idea of externality taxation gains more political trenchancy in relation to the taxation of industrial CO₂ emissions than in the taxation of nitrogen emissions from agriculture.