Bargaining in environmental regulation and the ideal regulator

Article Abstract:

A developed model of environmental regulation indicates that the stringency of the emission standard of a firm is dictated by cooperative bargaining between the firm and a regulator. Bargaining can be socially productive since it results in the first-best outcome which is never an equilibrium of the non-cooperative, Stackelberg game. Regulators do not look at the social cost function as the objective function if regulations are bargaining-dependent. There is lower social costs when a regulator is more concerned with damages and enforcement costs than to the firm's compliance costs.

Pollution Control & Abatement, Research, Industry regulations, Pollution control, Government regulation of business, Trade regulation, Administrative agencies, Government agencies

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Instrument choice when regulators and firms bargain

Article Abstract:

Tax-based policy and standard-based policy can be used as instruments of firms in cooperative bargaining over a restrictive regulation. Threat points as well as assymmetries between the tax-based and standard-based policies are expected to increase if a firm adopts multiple technologies. Nevertheless, asymmetries in the outcomes of taxes and standards would keep on existing because the technologies adopted by the firms are not social-cost-minimizing.

Sanitary Services, Air Pollution Control Programs, Models, Economic aspects, Air pollution control, Game theory

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Self-reporting and the design of policies for regulating stochastic pollution

Article Abstract:

A study on the desirability of self-report in compliance of environmental legislation is explored using a principal-agent framework. The model compares firms that have and do not have self-report. Results indicate that self-report firms must be audited more oftenthan firms not required to self-report. Self-reporting may not necessarily reduce sanctions. The desirability of self-reporting depends on several variables.

Management, Corporations, Environmental policy

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