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A paper with the title “The signaling effect of gasoline taxes and its distributional implications, by Stefano Verde (FSR Climate) and Silvia Tiezzi has been published in the Journal of Economic Inequality.
The paper proposes and tests a better-defined interpretation of the different responses of gasoline demand to tax changes and to market-related price changes. Namely, the signaling effect of gasoline taxes is one that impacts on long-run consumer decisions in addition to the incentives provided by tax-inclusive gasoline prices.
