Optimal Taxation Rule Reversal in the Presence of Gentle Polluters and Greedy Cleaners

Damien Sans ()

No 1549, AMSE Working Papers from Aix-Marseille School of Economics, France

Abstract: The literature on the micro-economics of the eco-industry often assumed interiority of pollutant net emissions. In a perfectly competitive final good market vertically integrated with an upstream monopoly supply this assumption implies that an optimal tax is always greater than its associated marginal social damage. In this short note we will relax this assumption and challenge that result. The market structure generates a unique threshold on the scale of the marginal social damage, whereby for any value above the threshold an optimal tax is strictly lower and net emissions are zero.

Keywords: Microeconomics; eco-industry; Imperfect Competition; Optimal Taxation (search for similar items in EconPapers)
JEL-codes: D42 D62 H23 L11 Q58 (search for similar items in EconPapers)
Pages: 10 pages
Date: 2015-12-14, Revised 2015-12-14
New Economics Papers: this item is included in nep-ene, nep-env, nep-pub and nep-res
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.amse-aixmarseille.fr/sites/default/files/_dt/2012/wp_2015_-_nr_49.pdf (application/pdf)

Related works:
Working Paper: Optimal Taxation Rule Reversal in the Presence of Gentle Polluters and Greedy Cleaners (2015)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aim:wpaimx:1549

Access Statistics for this paper

More papers in AMSE Working Papers from Aix-Marseille School of Economics, France AMU-AMSE - 5-9 Boulevard Maurice Bourdet, CS 50498 - 13205 Marseille Cedex 1. Contact information at EDIRC.
Bibliographic data for series maintained by Gregory Cornu ().