A substantial contribution in achieving sustainable development is the ordering of public revenue and spending according to economic and ecological principles. This project will examine the environmental impact of the German subsidy system with the aim of establishing effective economic incentives for government spending to achieve sustainable production and consumption structures. Preceding studies on individual aspects of this topic, e.g. on ecologically counterproductive tax incentives, have already been carried out for Germany, but an overall assessment of the environmental aspects of the German subsidy system is lacking. This research project will systematically examine the German subsidy system with regard to environmental aspects, will provide a contribution to the quantifying of ecologically counterproductive and ecologically motivated subsidies, and present options for an environmentally oriented reform of subsidy policy.
The study is being conducted on the basis of a literature analysis and an examination of the government's subsidy report. In addition, secondary statistics are employed and structured interviews have been conducted. This is a logical combination in order to link the subsidy issue in general (and the numerous publications on this issue) with the environmental issue, on which some new studies of subsidy policy exist with much still remaining to be done. Two expert workshops have been conducted. In the first workshop, the analytical framework of the study was presented for academic peer review. The second workshop gave a selected stakeholder group the opportunity to hear and discuss the results of the two case studies.
Final results await completion of the study. The most important results of the first part of the study lie in the development of an identification pattern for ecologically counterproductive and ecologically motivated subsidies. Building on an analysis of subsidy objectives, the first recommendations for environmental policy reform have already been made. In both case studies, ways to reform the existing subsidy system have been developed. This reform should take place in the form of a socially and economically compatible reduction of environmentally damaging subsidies. Also, a restructuring of subsidies based on the model of a lasting, environmentally suited development and integration of environmental aspects in non-environmentally oriented assistance programmes is required.
The results are scheduled to be published as a report in the series of the Federal Environmental Agency. One or two articles in refereed journals are planned.
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