Negative externalities (CO2) create a cost to society but they are not included in the cost and price of the product. According to intermediate economics, carbon tax is a type of Pigovian tax aiming to add social cost to private cost. According to the Pigovian tax, as long as producers realize the real cost of a product, they will increase its price. Increasing the price causes lower demand for the product.
Private automobiles cause a lot of pollution, so imposing a carbon tax to the fuel will decrease demand of using private cars. Supporters of the carbon tax believe that it will encourage people to use public buses more often.They claim that public transportation is beneficial for the environment and climate. According to the American Public Transportation Association, if the whole country switched to using public transportation, carbon emissions could be reduced up to 37 million metric tons per year. Moreover, by switching from driving a car to using public transportation, a person can reduce his or her carbon emissions by about 20 pounds daily.
The carbon tax will encourage people to use public transportation. The more people use public transportation, the less carbon would be emitted. However, is the public transportation system good enough to meet people’s needs?
In terms of quantity, U-District is a big area in Seattle but public transportation does not provide rides after 7 pm (you have to walk for long distance passing marijuana smokers).
In some countries, the public transportation is dangerous; for example, in Thailand, a train passenger can be raped during her journey. Moreover, I had an experience with a Taxi driver in Peru trying to change the fee (before I took the cab he said $10. After I was in the car, he raised the price to $30).
We try to save the environment but people have to face the consequences. Is it worthwhile to implement this policy now?
Public transportation should be improved first!