Regulation of Nonpoint Emissions under Limited Information: A Stress Experimental Test of the Ambient Tax Mechanism

Francois Cochard, Anthony Ziegelmeyer and Kene Boun My ()

Papers on Strategic Interaction from Max Planck Institute of Economics, Strategic Interaction Group

Abstract: We provide a stress experimental test of the ability of (a damaged based version) the ambient tax mechanism to induce socially optimal outcomes in a nonpoint pollution context. To mirror the features of naturally occurring environments, we consider a convex damage function, uncertainty in measuring the ambient level of pollution, polluters with heterogeneous profit functions competing against the same opponents for the duration of the experiment (which runs for an indeterminate length), and in half of our treatments polluters do not know others profit functions. In almost all implemented conditions, the observed total pollution level is not significantly different from the socially optimal level whereas, in none of the conditions, compliance at the individual level is observed. The efficiency performance of the ambient tax mechanism is higher (though not significantly) under limited information than under complete information as subjects comply more with the socially optimal level the less information about the profit functions of others they have.

Pages: 24 pages
Date: 2004-07
New Economics Papers: this item is included in nep-env and nep-exp
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
ftp://papers.econ.mpg.de/esi/discussionpapers/2003-33.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 500 Failed to connect to FTP server papers.econ.mpg.de: No such host is known.

Related works:
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:esi:discus:2003-33

Ordering information: This working paper can be ordered from
http://www.econ.mpg. ... arch/ESI/discuss.php

Access Statistics for this paper

More papers in Papers on Strategic Interaction from Max Planck Institute of Economics, Strategic Interaction Group Contact information at EDIRC.
Bibliographic data for series maintained by Karin Richter ( this e-mail address is bad, please contact ).