Comparative statics of a monopolistic firm facing price-cap and command-and-control environmental regulations

Michael Caputo

Energy Economics, 2014, vol. 46, issue C, 464-471

Abstract: An exhaustive comparative statics analysis of a model of a monopolistic firm facing price-cap regulation and a variety of commonly implemented command-and-control environmental regulations is carried out. The comparative statics are intrinsic to each of the models and thus form their basic, empirically testable properties. Several unanticipated results emerge from the analysis. In particular, it is shown that a subset of the intrinsic comparative statics are qualitatively invariant to all of the commonly employed command-and-control environmental regulations that a price-cap regulated profit-maximizing monopoly might face, while others are specific to the type of command-and-control environmental regulation in place.

Keywords: Price-cap regulation; Command-and-control environmental regulations; Comparative statics; Testable implications (search for similar items in EconPapers)
JEL-codes: D21 D42 L12 L51 Q50 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:46:y:2014:i:c:p:464-471

DOI: 10.1016/j.eneco.2014.05.013

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