Looking for theoretical foundation for Macro Economic Analysis of Photovoltaics from an MMT perspective. Or in other words: Should I consider subsidies and taxes as benefits/costs from a societal perspective?
This is gonna be a long one but I could really need the help of this community.
The setting:
I am working on developping a theoretical framework to assess the utility of Peatland-PV in Germany from a Macro-economic perspective.
Peatland-PV is the concept of rewetting peatlands which are currently drained and used for agriculture and placing PV on the rewetted surface.
From a macro-economic perspective, this creates benefits such as reduced GHG-emissions, which can be quantified through the social cost of carbon, increased biodiversity (incredibly difficult to quantify) and obviously the generated electricity (among others).
Most people would agree (I assume), that the CAPEX and OPEX of a Peatland-PV Project are to be considered as costs (from a macroeconomic perspective), as they quantify the resources needed to realize the project (labour and material resources). Added to these should be the integration costs of PV (System LCOE), transaction costs as well as opportunity costs (as the surface can't be used for agriculture anymore after rewetting).
Then comes the controversial part: Most people would probably assume that subsidies are a cost factor and taxes income (hence a benefit) from a societal point of view.
This view is, in my opinion, wrong: The subsidy does not represent a real consumption of resources, it merely prioritizes the allocation of real resources to the Peatland-PV project. The actual societal cost (use of resources) is entirely quantified through the CAPEX and OPEX of the project (and other costs discussed earlier). I understand though, how, if you assume that a governement can only spend money it has first earned through taxes, the prior assumption makes sense (in other words: if the government budget is considered a limited resource, considering a subsidy/expense as a societal cost does make sense. That assumption is false though, as real resources are scarce, not money).
Now the "problem" I'm facing is that I need existing literature/theory/models to justify why I don't consider subsidies and taxes in the analysis (calculating tax revenue would also be incredibly time-consuming) which is quite contrary to common economic thinking. I can't really find any literature on this specific question.
Am I right in my assumption, that in conventional macroeconomic analyses, taxes and government expenditures are considered?
Is there a way to justify not considering taxes/subsidies without arguing from a MMT-perspective?
Do you know existing theoretical frameworks or literature on similar analyses?
I'm grateful for any thoughts and potential literature recommendations.
Thanks in advance!