Emission taxes have an advantage over taxes on production in that

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Quizplus · Accepted Answer

Emission taxes create an incentive for firms to reduce pollution by installing pollution control equipment, changing their production processes or switching to cleaner technologies. This means that firms can use technology to change the amount of pollution associated with their production. Taxes on production, on the other hand, do not create an incentive for firms to reduce pollution and may result in a shift of production to countries with less stringent environmental regulations.

Emission Taxes Have an Advantage Over Taxes on Production in That