On the Social Value of Disclosed Information and Environmental Regulation

Jihad Elnaboulsi (jihad.elnaboulsi@univ-fcomte.fr), Wassim Daher and Y Saglam
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Jihad Elnaboulsi: CRESE - Centre de REcherches sur les Stratégies Economiques (UR 3190) - UFC - Université de Franche-Comté - UBFC - Université Bourgogne Franche-Comté [COMUE]
Y Saglam: Victoria University of Wellington

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Abstract: This paper presents an analysis of environmental policy in imperfectly competitive market with private information. We examine how environmental taxes should be optimally levied when the regulator faces asymmetric information about production and abatement costs in an irreversible observable policy commitment game. Under our setting, the paper investigates how information disclosure can improve the efficiency of the tax setting process and may offer an efficient complement to conventional regulatory approaches. From a policy perspective, our findings suggest that access to publicly disclosed information improves the ability of the regulator to levy Örmsí specific environmental taxes. Despite its advantages, however, informational disclosure may harm the environmental policy it purports to enhance since it facilitates collusive behavior. We show that information sharing may occur and thus leads to a superior outcome in terms of industry output and emissions. Disclosure may undermine market performance and environmental policy.

Keywords: Environmental Regulation; Emissions Taxes; Collusion; Disclosed Information; Private Information; Information Sharing (search for similar items in EconPapers)
Date: 2015-10-01
New Economics Papers: this item is included in nep-ene, nep-env, nep-law, nep-reg and nep-res
Note: View the original document on HAL open archive server: https://hal.science/hal-01377918v1
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Working Paper: On the Social Value of Disclosed Information and Environmental Regulation (2015)
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