Trust, Values and Quality of Government. Exploring Interactions Between Individual and Contextual Level Determinants of Environmental Tax Support

Abstract

Environmental taxes are argued to be the key to more effective environmental protection in developing countries. This paper investigates whether such taxes have the necessary public support to be successfully implemented in different contexts, including countries outside the Western and European spheres. Applying a multilevel analysis approach, using data from the World Values Survey and International Social Survey Programme, interaction effects between values, political and social trust, and perceived quality of government (QoG) are explored. It is hypothesized that if people lack trust in public authorities to implement green taxes in an efficient, fair and uncorrupt manner, they will be less likely to support such taxes despite their strong pro-environmental values or trust in other people. The results show that people holding green values are more likely to support environmental taxes if they live in countries with high levels of QoG. Moreover, the effect of social trust on support for green taxes appears to be contingent on individual-level political trust rather than the quality of government institutions. These interactions need further exploration since they vary across countries and datasets. While support for environmental taxes is found to be relatively high in some developing countries, public aversion towards higher taxes for environmental protection is still relatively high internationally.