Prices Vs. Quantities
Title | Prices Vs. Quantities PDF eBook |
Author | Erin Mansur |
Publisher | |
Total Pages | 52 |
Release | 2007 |
Genre | Environmental policy |
ISBN |
In a market subject to environmental regulation, a firm's strategic behavior affects the production and emissions decisions of all firms. If firms are regulated by a Pigouvian tax, changing emissions will not affect the marginal cost of polluting. However, under a tradable permits system, the polluters' decisions affect the permit price. This paper shows that this feedback effect may increase a strategic firm's output. Relative to a tax, tradable permits improve welfare in a market with imperfect competition. As an application, I model strategic and competitive behavior of wholesalers in the Pennsylvania, New Jersey, and Maryland electricity market. Simulations suggest that exercising market power decreased local pollution by approximately nine percent, and therefore, substantially reduced the price of the region's pollution permits. Furthermore, I find that had regulators opted to use a tax instead of permits, the deadweight loss from imperfect competition would have been approximately seven percent greater.
Prices vs quantities
Title | Prices vs quantities PDF eBook |
Author | Fridrik M. Baldursson |
Publisher | |
Total Pages | 32 |
Release | 1998 |
Genre | |
ISBN | 9788257091705 |
Prices Versus Quantities as Instruments of Plan Implementation
Title | Prices Versus Quantities as Instruments of Plan Implementation PDF eBook |
Author | Mongi Boughzala |
Publisher | |
Total Pages | 522 |
Release | 1978 |
Genre | |
ISBN |
Beyond Prices Versus Quantities
Title | Beyond Prices Versus Quantities PDF eBook |
Author | Stephen Martin |
Publisher | |
Total Pages | 36 |
Release | 1993 |
Genre | Commerce |
ISBN |
A Comparison of Price Controls and Quantity Controls Under Uncertainty
Title | A Comparison of Price Controls and Quantity Controls Under Uncertainty PDF eBook |
Author | Gary Wynn Yohe |
Publisher | Dissertations-G |
Total Pages | 296 |
Release | 1979 |
Genre | Business & Economics |
ISBN |
Prices Vs. Quantities
Title | Prices Vs. Quantities PDF eBook |
Author | Fridrik Mar Baldursson |
Publisher | |
Total Pages | 0 |
Release | 2005 |
Genre | |
ISBN |
We explore the efficacy of price and quantity controls in a dynamic setup in which the decisions of some agents are irreversible. The assumption of irreversibility is shown to improve the performance of a tax relative to that of a system of tradable quotas and significantly alter the equilibrium behavior of agents. We nevertheless conclude that taking into account the fact that agents' decisions may be irreversible does not lead to policy implications significantly different from those reached in a simpler model in which irreversibility is ignored.
The Theory and Practice of Command and Control in Environmental Policy
Title | The Theory and Practice of Command and Control in Environmental Policy PDF eBook |
Author | Peter Berck |
Publisher | Routledge |
Total Pages | 553 |
Release | 2018-01-12 |
Genre | Social Science |
ISBN | 1351769561 |
This title was first published in 2003. Economists have had increasing success in arguing the merits of market-based approaches to environmental problems. By making polluting expensive, market-based approaches provide polluters with incentives to clean up, rather than mandates to stop polluting. These approaches include pollution taxes, transferable emissions permits and subsidies for pollution abatement. The purpose of this volume is to explore the situations where Command and Control (CAC) may not be all bad, and in fact might even have some advantages over market-based instruments (MBI).