Do transportation taxes promote pro-environmental behaviour? An empirical investigation.

The transportation sector is a crucial driver of energy intensity and environmental degradation. Therefore, we aim to explore the nexus of transportation taxes, energy intensity, and CO 2 emissions for the BICS economies. The econometric approaches, CS-ARDL and PMG-ARDL, have been employed to compute the estimates. The long-run estimates of the green transportation tax variable are negatively significant in both energy intensity and CO 2 emissions models irrespective of the estimation technique. These findings imply that green transportation taxes help reduce energy intensity and CO 2 emissions in BICS economies. Conversely, in the short-run, the effects of transportation taxes on energy intensity and CO 2 emissions are mixed and inconclusive. Hence, transportation taxes are necessary to keep the polluters under control not only from the transport sector but also serve as a deterrent for other sectors as well.