Environmental Regulation and the Eco-Industry

Maia David and Bernard Sinclair-Desgagné

No 2004/06, Working Papers from INRA, Economie Publique

Abstract: This paper re-examines environmental regulation, under the assumption that pollution abatement technologies and services are provided by an imperfectly competitive environment industry. It is shown that each regulatory instrument (emission taxes and quotas; design standards; and voluntary agreements) has a specific impact on the price-elasticity of the polluters’ demand for abatement services, hence on the market power of the eco-industry and the resulting cost of abatement. This implies that the optimal pollution tax will be higher than the marginal cost of pollution damage, while a voluntary approach to pollution abatement may fail unless the eco-industry itself is properly regulated.

Keywords: Pollution regulation; End-of-pipe pollution abatement; Environment industry (search for similar items in EconPapers)
JEL-codes: H23 L13 Q58 (search for similar items in EconPapers)
Date: 2004-11-01
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Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Environmental Regulation and the Eco-Industry (2005)
Working Paper: Environmental Regulationand the Eco-Industry (2005)
Working Paper: Environmental Regulation and the Eco-Industry (2005)
Working Paper: Environmental regulation and the eco-industry (2005)
Working Paper: Environmental Regulation and the Eco-industry (2004)
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