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Tradable Permits Under Threat to Manage Nonpoint Source Pollution

Murad Ali, P. Le Grusse and Patrick Rio

No 44414, 2008 International Congress, August 26-29, 2008, Ghent, Belgium from European Association of Agricultural Economists

Abstract: In this article we treat the problem of nonpoint source pollution as a problem of moral hazard in group. To solve this kind of problem we consider a group performance based tax coupled to tradable permits market. The tax is activated if the group fails to meet the ambient standard. So the role of the tax is to provide an incitation to ensure that the agents provide the abatement level necessary to achieve the standard. The role of the tradable permits market is to distribute effectively this abatement level through the price of the permits which rises with the exchange of the permits.

Keywords: Environmental; Economics; and; Policy (search for similar items in EconPapers)
Pages: 12
Date: 2008
New Economics Papers: this item is included in nep-env
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Persistent link: https://EconPapers.repec.org/RePEc:ags:eaae08:44414

DOI: 10.22004/ag.econ.44414

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