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Piecemeal multilateral environmental policy reforms under asymmetric oligopoly

Lahiri, S and Symeonidis, G (2007) 'Piecemeal multilateral environmental policy reforms under asymmetric oligopoly.' Journal of Public Economic Theory, 9 (5). 885 - 899. ISSN 1097-3923

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Abstract

We develop a general two-country model with oligopolistic interdependence in which a fixed number of firms make their output and emission decisions simultaneously. We examine the effect of multilateral reforms of emission taxes on global emission levels. With sufficient asymmetry in pollution intensities between the two countries, a proportional multilateral increase in emission tax rates can increase global emission levels. However, a multilateral equal increase of emission tax rates unambiguously reduces global emission levels. We also consider the case of free entry and exit of firms, and find a rule of multilateral reforms which unambiguously lowers total emission levels. © 2007 Blackwell Publishing, Inc.

Item Type: Article
Subjects: H Social Sciences > HB Economic Theory
Divisions: Faculty of Social Sciences > Economics, Department of
Depositing User: Jim Jamieson
Date Deposited: 16 Aug 2012 10:20
Last Modified: 17 Aug 2017 18:08
URI: http://repository.essex.ac.uk/id/eprint/3685

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