Does Commuting Change the ranking of environmental instruments?

Bert Saveyn

Energy, Transport and Environment Working Papers Series from KU Leuven, Department of Economics - Research Group Energy, Transport and Environment

Abstract: This paper studies the income effects of environmental policy in jurisdictions with a common labor market and a heterogeneous population (workers and polluters). A jurisdiction unilaterally improves its local environmental quality, using a subsidy, an environmental tax or command-and-control. In a closed economy, workers and polluters have some kind of a "natural ranking" of instruments for a given environmental objective. We find that commuting across jurisdictions may upset this "natural ranking" of environmental instruments. Further, we see that this inter-jurisdictional commuting exports pollution and the costs of environmental policy, possibly causing strategic behavior.

Keywords: Environmental Instrument Choice; Commuting; Interest Groups (search for similar items in EconPapers)
JEL-codes: Q52 R23 (search for similar items in EconPapers)
Pages: 41 pages
Date: 2006-02
New Economics Papers: this item is included in nep-env, nep-geo and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:ete:etewps:ete0603

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