Allocation of costs to clean up a polluted river: an axiomatic approach

Wilson Vieira ()
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Wilson Vieira: Federal University of Vicosa, Brazil

Economics Bulletin, 2015, vol. 35, issue 2, 1216-1226

Abstract: This paper proposes a method to share the costs of cleaning up a polluted river among the agents located along it. This method is based on a model of pollutant transport and the polluter pays principle. We provide an axiomatic characterization for this method and investigate its relationship with both the (weighted) Shapley value and the tau-value of the corresponding cost game generated from the problem. We show that the solution of the proposed method coincides with both the weighted Shapley value and the tau-value.

Keywords: Water pollution; cost allocation; weighted Shapley value; tau-value. (search for similar items in EconPapers)
JEL-codes: C7 (search for similar items in EconPapers)
Date: 2015-06-01
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