Evaluating Policy Feedback in Canadian Tax and Dividend Policy using Panel Data

• In Event: Policy Feedback, Conflict and Process Tracing

Abstract

Over the past two decades, environmental politics in Canada have become increasingly contentious. Political elites are divided over the appropriate policy reforms to address the threat of global climate change, with stark differences emerging in federal versus provincial strategies. The result has been a persistent policy stalemate despite growing economic and social costs associated with policy inaction.

The current federal government has decided to deploy a carbon tax and dividend program in provinces that have not established their own carbon pricing system. This is a world-leading policy, and the first effort of its kind globally. It is premised on an assumption that redistributing the revenues from carbon pricing policies to the public at large will generate a public coalition in support of climate reforms. A number of US advocacy coalitions have been pressing for similar policies in the United States, rooted in this same policy feedback logic.

Yet, this assumption has never been subjected to rigorous empirical scrutiny. Despite the severe risks posed by climate change, we still have a weak understanding of why people change their environmental beliefs and behaviors over time. We still don’t know carbon tax and dividend policies interact with political conditions and public opinion on the ground. The Canadian experiment provides a case for social science scholars to study these dynamics in real-time.

The major barrier to studying environmental opinion and value change is, simply, a lack of data on change itself. Existing data on the Canadian public’s climate beliefs consist of “snapshots” of the public at various points in time. However, the individuals who are surveyed change from snapshot to snapshot. The same is true of most climate opinion panels in the United States and elsewhere in the world. By contrast, panel data is the methodological gold standard for social scientific research about individual-level opinion and value changes. A panel survey, unlike the conventional cross-sectional survey, interviews the same respondents many times over months or years.

In this paper we report results from a major, ongoing panel study tracking Canadian responsiveness to national climate reforms. Between January 2019 and August 2019, we are following a large-n group of Canadians in the provinces of British Columbia, Alberta, Saskatchewan, Ontario and Quebec. We periodically survey these individuals to see how their attitudes towards climate change and climate policy change at different stages of political debate over carbon pricing, and different stages of the carbon tax and rebate implementation. This unique dataset will help track public beliefs about environmental, energy, and climate concerns at a moment when they are central to the dynamics of Canadian political conflict. Critically, this data allows us to assess whether rebate cheques are an effective tool for building durable support coalitions in favor of carbon pricing. We can evaluate directly, for the first time, whether the design of climate policies can reshape public attitudes towards costly climate reforms.

Wave 1 is currently in the field, to develop a set of baseline measurements. We will field Wave 2 in early April (after the Canadian carbon tax comes into effect but before most Canadians receive their rebates). We will field Wave 3 in early May (after most Canadians have filed their taxes). We anticipate that the carbon tax rebates will be heavily advertised during this filing process. We will field Wave 4 in the late summer, after a majority of Canadians have received their annual tax returns. Using within-subject fixed effects estimators applied to this new dataset, we will present original analyses of policy feedback effects in Canadian climate policymaking. Our results will be of interest to the broader political science community, both in shedding new light on the climate policymaking dynamics and in offering a new empirical evaluation of policy feedback theory.

Authors

• Matto Mildenberger, University of California Santa Barbara

• Erick Lachapelle, Universite de Montreal

• Kathryn Harrison, University of British Columbia

• Leah Stokes, UCSB