Taxation régionale versus nationale en présence de pollution transfrontalière

Michel Cavagnac () and Isabelle Péchoux

Revue économique, 2010, vol. 61, issue 1, 35-56

Abstract: We consider a two-country model of strategic trade with transboundary pollution. Environmental policy may be decided either at the regional level or at the national level. We study how changing the decision center impacts on, respectively, trade, firms? profit, environmental damage, regional and national welfare. We show that a centralized policy turns out to be in favour of domestic firm?s profit but at the cost of a bad environmental quality. Concerning the usual criterion of social welfare, we show that the policy adopted by a regional decision-maker, only concerned by local considerations, might implement a national welfare higher than the welfare achieved by a national regulator. Classification JEL : F12; F18; H23; Q28.

JEL-codes: Q28 (search for similar items in EconPapers)
Date: 2010
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