IDEAS home Printed from https://ideas.repec.org/a/eee/eecrev/v36y1992i6p1263-1276.html
   My bibliography  Save this article

Controlling stock externalities : Flexible versus inflexible Pigovian corrections

Author

Listed:
  • Ko, Il-Dong
  • Lapan, Harvey E.
  • Sandler, Todd

Abstract

This paper examines the use of inflexible Pigovian taxes/subsidies to correct a stock externality. An optimal control framework is first used to characterize the first-best path for a Pigovian correction that varies continuously. This first-best path is then contrasted with inflexible second-best paths in which the level of the correction can be set only once or twice. The optimal timing of a fixed one-time correction is also studied. A deferment of this correction is desirable when the initial state of the environmental stock is less deteriorated than the first-best steady state or the adjustment costs are sufficiently great.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Ko, Il-Dong & Lapan, Harvey E. & Sandler, Todd, 1992. "Controlling stock externalities : Flexible versus inflexible Pigovian corrections," European Economic Review, Elsevier, vol. 36(6), pages 1263-1276, August.
    • Handle: RePEc:eee:eecrev:v:36:y:1992:i:6:p:1263-1276
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/0014-2921(92)90031-Q
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Dominique Prunetti, 1998. "Taxation dynamique dans le cadre d'une industrie polluante concurrentielle et de deux variables de contrôle," Revue d'Économie Industrielle, Programme National Persée, vol. 83(1), pages 167-181.
    2. Denis Claude & Charles Figuières & Mabel Tidball, 2012. "Regulation of Investments in Infrastructure: The Interplay between Strategic Behaviors and Initial Endowments," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 14(1), pages 35-66, February.
    3. Gaston Giordana & Marc Willinger, 2013. "Fixed instruments to cope with stock externalities: an experimental evaluation," Chapters, in: John A. List & Michael K. Price (ed.), Handbook on Experimental Economics and the Environment, chapter 13, pages 367-403, Edward Elgar Publishing.
    4. Greiner, Romy & Cacho, Oscar, 2001. "On the efficient use of a catchment's land and water resources: dryland salinization in Australia," Ecological Economics, Elsevier, vol. 38(3), pages 441-458, September.
    5. Franz Wirl, 1994. "Efficient introduction of Pigovian taxes," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 4(6), pages 535-544, December.
    6. Kjell Holmåker & Thomas Sterner, 1999. "Growth or environmental concern: which comes first? Optimal control with pure stock pollutants," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 2(3), pages 167-185, September.
    7. Kjell Holmåker & Thomas Sterner, 1999. "Growth or environmental concern: which comes first? Optimal control with pure stock pollutants," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 2(3), pages 167-185, September.
    8. Raghbendra Jha & John Whalley, 2001. "The Environmental Regime in Developing Countries," NBER Chapters, in: Behavioral and Distributional Effects of Environmental Policy, pages 217-250, National Bureau of Economic Research, Inc.
    9. Farmer, Amy & Kahn, James R. & McDonald, Judith A. & O'Neill, Robert, 2001. "Rethinking the optimal level of environmental quality: justifications for strict environmental policy," Ecological Economics, Elsevier, vol. 36(3), pages 461-473, March.
    10. Ana Espínola-Arredondo & Félix Muñoz-Garcia & Jude Bayham, 2014. "The Entry-Deterring Effects of Inflexible Regulation," Canadian Journal of Economics, Canadian Economics Association, vol. 47(1), pages 298-324, February.
    11. Moghaddam, Hussein & Wirl, Franz, 2018. "Determinants of oil price subsidies in oil and gas exporting countries," Energy Policy, Elsevier, vol. 122(C), pages 409-420.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:eecrev:v:36:y:1992:i:6:p:1263-1276. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/eer .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.