Indholdsfortegnelse
Assignment 1
a) Based on appendix 1, calculate an index for the development of different forms of transportation in Denmark where 1990=100

Show a graphic illustration of the index calculation in a line chart and explain the development.

b) In appendix 2, you see an example of price formation for domestic flights (Copenhagen-Aalborg) and international flights (Copenhagen-London). The starting point is the same price without taxes (600 DDK) and the same added tax (100 DKK).

Find the price equilibrium before and after the tax is added to domestic and international flights. Explain why the tax has different effects on domestic and international flights.

c) Explain advantages and disadvantages for Denmark of adopting taxes on flights in comparison with an administrative rule that limits the number of times a Dane is allowed to travel each year, e.g. twice a year.

2.2
a) Based on your analysis in assignment 2.1 and appendices 4 and 5, assess the advantages and disadvantages of using expansionary fiscal policy.

b) Discuss whether the current economic situation renders it beneficial for the government to spend 10 billion on green investments in accordance with the Danish National Climate Act. The 10 billion will be financed through increased passenger taxes on flights.

Assignment 3
All parties of the Danish Parliament (except Nye Borgerlige and Liberal Alliance) have adopted a new climate law stipulating an objective of a 70 % reduction of CO2 emissions by 2030. Only the actual objectives were adopted. The final plan of action including political instruments has of yet (as per March 1st 2020) not been developed and adopted.

As advisor to the government concerning environmental economics, you have been tasked with writing a briefing note containing maximum 600 words.

The note must contain a presentation of suitable political measures and an assessment of consequences of these. Write the briefing note with appendices 6, 7, 8 and 9 as a starting point as well as your response to assignments 1 and 2.

The briefing note must contain assessments of:

Optimer dit sprog - Læs vores guide og scor topkarakter

Uddrag
In the line chart to the left we can deduce that cars, busses, and trains have been somewhat steady, with a small increase, whilst ships and flights have decreased.

Ship and aviation transport might be faster and more efficient, but these are both very expensive means of transportation.

Furthermore, in this day and age with focus on the environment and CO2 emissions, this has presumably been one of the primary factors in the decline of ship and aviation domestic transport in a country as small as Denmark.

Transport by cars and vans has been somewhat steady, going up and down by only a couple of percentage points each year from 1990-2010.

Then after 2010 transport by cars and vans took off and generated an increase of 29,12 percentage points from 1990-2018.

Transport by buses has had a greater fluctuating up and down each year, creating an increase by only 10,32 percentage points from 1990-2018.

Moving onto transport by trains which has increased tremendously by 34,45 percentage points at its highest, and the final increase of 29,62 from 1990-2018.

Then we have transport by ships contrary to the above mentioned means of transportation transport by ship has had a disappointing development, their use being almost cut in half, decreasing by 45,41 from 1990-2018.

Lastly, we have transport by domestic flights which has experienced a steady decrease of 26,79 percentage points from 1990-2018.

---

There are both advantages and disadvantages for the adoption of taxes and an administrative rule on flights to limit the number of times a Danish citizen is allowed to travel each year.

One the one hand we have the taxation on flights, looking at appendix 6, adopting taxes on flights will lessen the wear on the environment as this will stop some people from travelling as frequently as they would without the tax, and stop others from travelling altogether.

The Danish government will hereby be able to regulate the air pollution through the limitation of domestic flights taking off.

A tax would not only bring light to the impact that aviation transportation has on the world, but also promote a more environmentally safe way of travelling e.g., by bus or train so the CO2 emissions would be shared.

The environment is a priority in the majority of the world’s countries, and by adapting a taxation on flights Denmark will gain respect from our surrounding countries as we take initiative and try to “lead by example” in the fight against air pollution and global warming.

Furthermore, there will be multiple positive impacts in the long run as less air pollution will lessen the pollution related deceases.

This tax will also mean the Danish government gains a profit they can then spend on bettering the environment, the infrastructure, or the healthcare system.

Though we need to remember these taxes will primarily be paid by one income group, as spending on flight is relative to the consumers’ income.

Those in the high-income groups tend to spend a bigger share of their income on flights, students being the only exception to this spending the far biggest share of their income on flights, as we see in the graphs above.