About polluting eco-industries: optimal provision of abatement goods and Pigouvian fees
-
DOIhttp://dx.doi.org/10.21511/ee.08(3).2017.05
-
Article InfoVolume 8 2017, Issue #3, pp. 46-61
- Cited by
- 973 Views
-
166 Downloads
This work is licensed under a
Creative Commons Attribution-NonCommercial 4.0 International License
In this article, the authors introduce a polluting eco-industry. Depending on the level of damage, there are two optimal equilibria. If the damage is low, one generalizes the usual results of the economic literature to the polluting eco-industry: the dirty firm partially abates their emissions, only efficient eco-industry firms produce and the abatement level increases with the damage. However, very specific results are obtained if the damage is high. In this case, not all efficient eco-industry firms produce. The abatement level and the number of active eco-industry firms both decrease as the damage increases. The authors finally show that a well-designed Pigouvian tax implements these equilibria in a competitive economy.
- Keywords
-
JEL Classification (Paper profile tab)D62, Q58, L11
-
References28
-
Tables0
-
Figures0
-
- Boyd, G. R., Reemtsma, H., Grimm, D. A., Mitra, S. (2003). Pharmaceuticals and personal care products (PPCPs) in surface and treated waters of Louisania, USA and Ontario, Canada. Science of the total Environment, 311, 135-149.
- Canton, J. (2008). Redealing the cards: how an eco-industry modifies the political economy of environmental taxes. Resource and Energy Economics, 30(3), 295-315.
- Canton J., David, M., & Sinclair-Desgagné, B. (2012). Environmental regulation and horizontal mergers in the eco-industry. Strategic Behavior and the environment, 2, 107-132.
- Canton J., Soubeyran, A., & Stahn, H. (2008). Environmental taxation and vertical Cournot oligopolies: how eco-industries matter. Environmental and Resource Economics, 40(3), 369-382.
- Comoretto, L., Chiron, S. (2005). Comparing pharmaceutical and pesticide loads into a small Mediterranean river. Science of the total Environment, 349, 201-210.
- David, M., & Sinclair-Desgagné, B. (2005). Environmental regulation and the eco-industry. Journal of Regulatory Economics, 28(2), 141-155.
- David, M., & Sinclair-Desgagné, B. (2010). Pollution abatement subsidies and the eco-industry. Environmental and Resource Economics, 45(2), 141-155.
- David M., Nimubona, A. D., & Sinclair-Desgagné, B. (2011). Emission taxes and the market for abatement goods and services. Resource and Energy Economics, 33, 179-191.
- Denicolo, V. (1999). Pollution-reducing innovations under taxes or permits. Oxford Economic Papers, 51, 184-199.
- Ernst and Young. (2006). Eco-industry, its size, employment, perspectives and barriers to growth in an enlarged EU. Final Report to the DG environment of the European Commission.
- European Commission Report (1999). The EU eco-industry’s export potential.
- European Commission Report (2007). Facts and figures: the link between EU’s economy and environment.
- European Commission Report (2009). Study on the Competitiveness of the EU eco-industry.
- Greaker, M. (2006). Spillovers in the development of new pollution abatement technology: a new look at the Porter-hypothesis. Journal of Environmental Economics and Management, 52, 411-420.
- Greaker, M., & Rosendahl, K. E. (2008). Environmental policy with upstream pollution abatement technology firms. Journal of Environmental Economics and Management, 56, 246-259.
- Kyung, D., Kim, D., Park, N., Leeand, W. (2013). Estimation of CO2 emission from water treatment plant - Model development and application. Journal of Environmental Management, 131, 74-81.
- Nawaz I., & Tiwari, G. N. (2006). Embodied energy analysis of photovoltaic (PV) system based on macro and micro-level. Energy Policy, 34, 3144-3152.
- Nimubona, A. D. (2012). Pollution policy and trade liberalization of environmental goods. Environmental and Resource Economics, 52, 323-346.
- Nimubona, A. D., & Sinclair-Desgagné, B. (2005). The Pigouvian tax rule in the presence of an ecoindustry FEEM, Nota di Lavoro, 57.
- Nimubona, A. D., & Sinclair-Desgagné, B. (2011). Polluters and abaters. Annales d’Economie et de Statistiques, 103/104, 9-24.
- Nosaky, Y., Lerche, D., Alibo, D. S., Tsutsumi, M. (2000). Dissolved indium and rare earth elements in three japonese rivers and Tokyo bay: evidence for anthropogenic Gd and In. Géochimie Cosmochimie Acta, 64, 975-3982.
- OECD (1999). The environmental goods and services industry: Manual for data collection and analysis. OCDE Editions, Paris.
- Raucher, R. S., Cromwell, J. E, Cooney, K., Thompson, P., Sullivan, L., Carrico, B., Macphee, M., Wilkinson, R. (2008). Risk and benefits of energy management for drinking water utilities. AwwaRF, Denver.
- Tyrrell Rockafellar, R. (1997). Convex Analysis. Princeton landmarks in mathematics (Reprint of the 1979 Princeton mathematical series 28 ed.). Princeton, NJ: Princeton University Press.
- Rothausen, S., & Conway, D. (2011). Greenhouse-gas emissions from energy use in the water sector. Nature Climate Change, 1, 210-219.
- Schwartz, S., Stahn, H. (2014). Competitive permit markets and vertical structures: the relevance of imperfectly competitive eco-industries. Journal of Public Economic Theory, 16(1), 69-95.
- Sinclair-Desgagné, B. (2008). The environmental goods and services industry. International Review of Environmental and Resource Economics, 2(1), 69-99.
- Ternes, T. A. (1998). Occurrence of drugs in German sewage treatment plants and rivers. Water Resources, 32, 3245-3260.