 Formal and informal quota enforcementResource and Energy Economics, 2013, vol. 35, issue 2, 191-215 Abstract: I study renewable resource use and compliance in a dynamic model with both informal and formal modes of enforcement. Agents obtain utility from both resource use and from behaving according to a norm of quota compliance. The users can exceed their quota at the risk of being detected and formally punished, but they also risk informal sanctions in the form of social disapproval and guilt. I find that when accounting for informal enforcement, there is an indirect effect of regulatory change in addition to the intended direct effect. When policy change, such as tougher enforcement, makes individuals more compliant, the norm of compliance is gradually strengthened, which in turn induces more compliant behavior. I study the implications of policy change on compliance level, quota prices, and the norm of compliance, and show how the properties of the punishment function have important implications for the outcome. Keywords: Renewable resources; Norms; Tradable quotas; Regulatory compliance; Formal and informal enforcement (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:resene:v:35:y:2013:i:2:p:191-215 DOI: 10.1016/j.reseneeco.2012.10.001 Access Statistics for this article Resource and Energy Economics is currently edited by J. F. Shogren and S. Smulders More articles in Resource and Energy Economics from Elsevier |
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