Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/119695
Authors: 
Franckx, Laurent
Year of Publication: 
2002
Series/Report no.: 
Nota di Lavoro, Fondazione Eni Enrico Mattei 88.2002
Abstract: 
We consider an inspection game between $n$ polluting firms and an environmental enforcement agency. If the cost of monitoring ambient pollution is low enough, the optimal inspection policy consists in imposing the maximal possible fine, and mixing between observing ambient pollution and not conducting any inspection at all. However, with stringent upper limits on the fine, the agency mixes between observing ambient pollution and inspecting all firms. The observation of ambient pollution is always followed by sequentially rational firm inspections. Comparisons with Franckx (2002a,2002b) show that commitment power has a very strong impact on the value of prior information.
Subjects: 
environmental enforcement
ambient inspections
commitment
JEL: 
K42
Q20
Document Type: 
Working Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.