Optimal taxOptimal tax theory or the theory of optimal taxation is the study of designing and implementing a tax that maximises a social welfare function subject to economic constraints. The social welfare function used is typically a function of individuals' utilities, most commonly some form of utilitarian function, so the tax system is chosen to maximise the aggregate of individual utilities. Tax revenue is required to fund the provision of public goods and other government services, as well as for redistribution from rich to poor individuals.
Pigouvian taxA Pigouvian tax (also spelled Pigovian tax) is a tax on any market activity that generates negative externalities (i.e., external costs incurred by the producer that are not included in the market price). The tax is normally set by the government to correct an undesirable or inefficient market outcome (a market failure) and does so by being set equal to the external marginal cost of the negative externalities. In the presence of negative externalities, social cost includes private cost and external cost caused by negative externalities.
Enlargement of the European UnionThe European Union (EU) has expanded a number of times throughout its history by way of the accession of new member states to the Union. To join the EU, a state needs to fulfil economic and political conditions called the Copenhagen criteria (after the Copenhagen summit in June 1993), which require a stable democratic government that respects the rule of law, and its corresponding freedoms and institutions. According to the Maastricht Treaty, each current member state and the European Parliament must agree to any enlargement.
Algorithmic tradingAlgorithmic trading is a method of executing orders using automated pre-programmed trading instructions accounting for variables such as time, price, and volume. This type of trading attempts to leverage the speed and computational resources of computers relative to human traders. In the twenty-first century, algorithmic trading has been gaining traction with both retail and institutional traders. A study in 2019 showed that around 92% of trading in the Forex market was performed by trading algorithms rather than humans.
Social liberalismSocial liberalism (Sozialliberalismus, socioliberalismo, Sociaalliberalisme) is a political philosophy and variety of liberalism that endorses social justice and the expansion of civil and political rights. It is economically based on the social market economy and views the common good as harmonious with the individual's freedom. Social liberals overlap with social democrats in accepting economic intervention more than other liberals; its importance is considered auxiliary compared to social democrats.
High-frequency tradingHigh-frequency trading (HFT) is a type of algorithmic trading in finance characterized by high speeds, high turnover rates, and high order-to-trade ratios that leverages high-frequency financial data and electronic trading tools. While there is no single definition of HFT, among its key attributes are highly sophisticated algorithms, co-location, and very short-term investment horizons in trading securities. HFT uses proprietary trading strategies carried out by computers to move in and out of positions in seconds or fractions of a second.
Net energy gainNet Energy Gain (NEG) is a concept used in energy economics that refers to the difference between the energy expended to harvest an energy source and the amount of energy gained from that harvest. The net energy gain, which can be expressed in joules, differs from the net financial gain that may result from the energy harvesting process, in that various sources of energy (e.g. natural gas, coal, etc.) can be priced differently for the same amount of energy.
Energy intensityEnergy intensity is a measure of the energy inefficiency of an economy. It is calculated as units of energy per unit of GDP (Gross Domestic Product) or some other measure of economic output. High energy intensities indicate a high price or cost of converting energy into GDP. On the other hand, Low energy intensity indicates a lower price or cost of converting energy into GDP. The energy intensity of a country or region differs from its energy efficiency. Energy intensity is affected by climate, economic structure (e.
Energy subsidyEnergy subsidies are measures that keep prices for customers below market levels, or for suppliers above market levels, or reduce costs for customers and suppliers. Energy subsidies may be direct cash transfers to suppliers, customers, or related bodies, as well as indirect support mechanisms, such as tax exemptions and rebates, price controls, trade restrictions, and limits on market access. The International Renewable Energy Agency tracked some $634 billion in energy-sector subsidies in 2020, and found that around 70% were fossil fuel subsidies.
Sustainable energyEnergy is sustainable if it "meets the needs of the present without compromising the ability of future generations to meet their own needs." Most definitions of sustainable energy include considerations of environmental aspects such as greenhouse gas emissions and social and economic aspects such as energy poverty. Renewable energy sources such as wind, hydroelectric power, solar, and geothermal energy are generally far more sustainable than fossil fuel sources.
