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Title:Hold-up Problems with Respect to R&D Investment and Licensing in Environmental Regulation PDF Logo
Authors:Breitscheidel, Jörg
Issue Date:2005
Series/Report no.:ZEW Discussion Papers 05-86
Abstract:We explore the design of self-financing tax-subsidy schemes to solve hold-up problems in environmental regulation. The announcement of the tax rate seems to be preferable to solve hold-up problems with respect to the investment in environmental R&D. In contrast, only the announcement of the subsidy rate is adequate to solve hold-up problems with respect to the licensing of environmentally friendly technologies. Altogether, the announcement of the subsidy rate yields higher expected social welfare than the announcement of the tax rate or the standard emission taxation if the marginal damage of emissions exceeds a certain level.
Subjects:Hold-up problems
Environmental regulation
Taxes and subsidies
Selffinancing mechanisms
Emission control
Document Type:Working Paper
Appears in Collections:ZEW Discussion Papers
Publikationen von Forscherinnen und Forschern des ZEW

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