Climate change skepticism and farmers' responses to CO2e taxation

Agriculture is a major contributor to greenhouse gas (GHG) emissions, yet it has largely been exempt from stricter environmental regulations, partly due to strong resistance from the sector. Across Europe, farmers' widespread opposition has often resulted in the weakening or rollback of ambitious environmental policies. In Denmark, the recent introduction of a CO2e (CO2-equivalent) tax on agricultural emissions, one of the first global attempts to directly target non-fossil fuel-based GHGs, has similarly prompted immediate organized farmer protests. This study examines whether and to what extent climate change skepticism (CCS) is associated with farmers' belief misalignment about the economic impact of the CO2e tax on agriculture, resistance to the tax, and adoption of climate mitigation measures, drawing on a survey of 981 Danish farmers. We find that climate skeptic farmers substantially overestimate the tax's negative impacts while discounting expert assessments. Climate neutral and skeptic farmers show greater opposition to the CO2e tax, with CCS strongly predicting resistance even after accounting for tax design, information, and farm characteristics. Higher CCS is also associated with lower adoption of climate mitigation measures, with participation in subsidized climate initiatives about 25% lower among skeptics compared with non-skeptics. These patterns are more pronounced among livestock producers than crop producers. Overall, the findings underscore the importance of climate-related beliefs in explaining variation in beliefs about policy impacts, policy acceptance, and behavioral responses.