Environmental regulation and mergers within the eco-industry

Joan Canton (), Maia David and Bernard Sinclair-Desgagné

No 2007/01, Working Papers from INRA, Economie Publique

Abstract: The welfare implications of a merger in an environment industry (i.e. the industry that supplies abatement goods and services) are considered in a Cournot-Nash context. The traditional analysis of mergers is extended in two ways. First, we examine how the environmental policy may affect the incentives to merge in this specific sector. Second, we show that mergers in the environment industry impact welfare beyond what is observed in other sectors due to an extra effect on the environment. This could result in a conflict between an anti-trust agency, whose mandate is to focus on consumers' and firms' surplus, and a benevolent regulator considering the overall welfare.

Keywords: Eco-industry; Environmental tax; Horizontal mergers (search for similar items in EconPapers)
JEL-codes: D62 H23 L11 (search for similar items in EconPapers)
Date: 2007-02-08
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Related works:
Working Paper: Environmental regulation and mergers within the eco-industry (2012)
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