Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/74074
Authors: 
Sinclair-Desgagné, Bernard
David, Maia
Year of Publication: 
2005
Series/Report no.: 
Nota di Lavoro, Fondazione Eni Enrico Mattei 56.2005
Abstract: 
This paper re-examines environmental regulation, under the assumption that pollution abatement technologies and services are provided by an imperfectly competitive environment industry. It is shown that each regulatory instrument (emission taxes and quotas; design standards; and voluntary agreements) has a specific impact on the price-elasticity of the polluters’ demand for abatement services, hence on the market power of the eco-industry and the resulting cost of abatement. This implies that the optimal pollution tax will be higher than the marginal social cost of pollution, while a voluntary approach to pollution abatement may fail unless the eco-industry itself is willing to participate.
Subjects: 
Pollution regulation
End-of-pipe pollution abatement
Environment industry
JEL: 
H23
L13
Q58
Document Type: 
Working Paper

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