Voluntary Agreements and Non-Verifiable Emissions

Authors:

Nyborg, K.

Year:

2000

Reference:

17 (2), 125-144.

Summary

If pollution is observable, but some emissions cannot be verified by court,voluntary agreements between a regulator and an industry may bewelfare-improving compared to second-best emission taxes. Such agreementsdiffer from direct regulation in a non-trivial way. The first-best optimummay be included in the set of possible agreements, even if it is notattainable using tax instruments. The non-verifiability may, for example, beassociated with delimitation problems in defining the pollution tax base.

Project:

Oppdragsgiver:
Oppdragsgivers prosjektnr.:
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Contact:

karine.nyborg@frisch.uio.no