Consistency and Optimality in a Dynamic Game of Pollution Control I: Competition

Amitrajeet Batabyal ()

Working Papers from Utah State University, Department of Economics

Abstract: I model the interaction between a regulator and polluting firms as a Stackelberg differential game in which the regulator leads. The firms create pollution, which results in a stock externality. I analyze the intertemporal effects of alternate pollution control measures in a competitive industry. The principal issue here concerns the dynamic inconsistency of the optimal solution. Inter alia, I compare the steady state levels of pollution under optimal and under time consistent policies.

Keywords: environmental; regulation; tax; dynamic; game (search for similar items in EconPapers)
JEL-codes: Q25 H32 D62 (search for similar items in EconPapers)
Pages: 29 pages
Date: 1995-11
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Forthcoming in Environmental and Resource Economics

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Related works:
Journal Article: Consistency and optimality in a dynamic game of pollution control I: Competition (1996)
Working Paper: CONSISTENCY AND OPTIMALITY IN A DYNAMIC GAME OF POLLUTION CONTROL I: COMPETITION (1995)
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Persistent link: https://EconPapers.repec.org/RePEc:usu:wpaper:9529

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