Word: pigouvian
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Considered Pigouvian, the gas tax makes driving reflect its true cost, economically and environmentally. Driving and burning gas is associated with many negative externalities, as it produces pollution and contributes to global warming—both of which tax payments can help offset. On the environmental front, a higher gas tax will also create incentives for motorists to buy more fuel-efficient cars, or even hybrids. It might also encourage people to carpool or use the public transportation system more often. This in turn will decrease air pollution and traffic jams...
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