Environmental taxation in Europe: what does it depend on?

The present work adds to the existing literature the analysis of thedeterminants of environmental taxation in European economies. Using a pooledpanel data, we consider various groups of factors influencing environmental taxationreferring to production and consumption, environmental performance and thequality of governance of European countries, taking into account their heterogeneity.We argue that in order to function, environmental taxation policy should rely on thevirtuous interrelationship between economic development and institutional enforcement,which contributes to enhancing the process of environmental renaissance.