Implementing second-best environmental policy under adverse selection
AbstractA key obstacle to practical application of mechanism design theory to regulation is the difficulty of obtaining consistent beliefs regarding information that theoretical models assume to be commonly held. This article presents a solution to this problem by developing an easily implemented empirical methodology with which the government can use available data to develop beliefs regarding the technology and distribution of types in a regulated sector characterized by hidden information. Results are used to calibrate a second-best land conservation mechanism and evaluate its cost relative to simpler alternatives.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Elsevier in its journal Journal of Environmental Economics and Management.
Volume (Year): 57 (2009)
Issue (Month): 3 (May)
Contact details of provider:
Web page: http://www.elsevier.com/locate/inca/622870
Empirical contract theory Environmental policy Stochastic frontier analysis Adverse selection;
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Pascal Lavergne & Alban Thomas, 2005. "Semiparametric estimation and testing in a model of environmental regulation with adverse selection," Empirical Economics, Springer, vol. 30(1), pages 171-192, January.
- Guesnerie, Roger & Laffont, Jean-Jacques, 1984. "A complete solution to a class of principal-agent problems with an application to the control of a self-managed firm," Journal of Public Economics, Elsevier, vol. 25(3), pages 329-369, December.
- Newey, Whitney K., 1984. "A method of moments interpretation of sequential estimators," Economics Letters, Elsevier, vol. 14(2-3), pages 201-206.
- Aigner, Dennis & Lovell, C. A. Knox & Schmidt, Peter, 1977. "Formulation and estimation of stochastic frontier production function models," Journal of Econometrics, Elsevier, vol. 6(1), pages 21-37, July.
- Fuss, Melvyn A., 1977. "The demand for energy in Canadian manufacturing : An example of the estimation of production structures with many inputs," Journal of Econometrics, Elsevier, vol. 5(1), pages 89-116, January.
- Philippe Gagnepain & Marc Ivaldi, 2002.
"Incentive Regulatory Policies: The Case of Public Transit Systems in France,"
RAND Journal of Economics,
The RAND Corporation, vol. 33(4), pages 605-629, Winter.
- Philippe Gagnepain & Marc Ivaldi, 2002. "Incentive Regulatory policies: The Case of Public Transit Systems in France," Post-Print hal-00622846, HAL.
- Gagnepain, Philippe & Ivaldi, Marc, 1999. "Incentive Regulatory Policies: The Case of Public Transit Systems in France," IDEI Working Papers 84, Institut d'Économie Industrielle (IDEI), Toulouse.
- Gagnepain, P. & Ivaldi, M., 1999. "Incentive Regulatory Policies: the Case of Public Transit Systems in France," Papers 99.515, Toulouse - GREMAQ.
- Bousquet, Alain & Ivaldi, Marc, 1997. "Optimal pricing of telephone usage: An econometric implementation," Information Economics and Policy, Elsevier, vol. 9(3), pages 219-239, September.
- Thomas Alban, 1995. "Regulating Pollution under Asymmetric Information: The Case of Industrial Wastewater Treatment," Journal of Environmental Economics and Management, Elsevier, vol. 28(3), pages 357-373, May.
- Carree, Martin A., 2002.
"Technological inefficiency and the skewness of the error component in stochastic frontier analysis,"
Elsevier, vol. 77(1), pages 101-107, September.
- Martin A. Carree, 2002. "Technological Inefficiency and the Skewness of the Error Component in Stochastic Frontier Analysis," Tinbergen Institute Discussion Papers 02-012/2, Tinbergen Institute.
- Crepin, Anne-Sophie, 2005. "Incentives for wetland creation," Journal of Environmental Economics and Management, Elsevier, vol. 50(3), pages 598-616, November.
- Pepper, John V., 2002. "Robust inferences from random clustered samples: an application using data from the panel study of income dynamics," Economics Letters, Elsevier, vol. 75(3), pages 341-345, May.
- Jean Tirole, 1988. "The Theory of Industrial Organization," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262200716, January.
- Mark Bagnoli & Ted Bergstrom, 2005.
"Log-concave probability and its applications,"
Springer, vol. 26(2), pages 445-469, 08.
- Dalen, Dag Morten & Gomez-Lobo, Andres, 1997. "Estimating cost functions in regulated industries characterized by asymmetric information," European Economic Review, Elsevier, vol. 41(3-5), pages 935-942, April.
- David P. Baron & Roger B. Myerson, 1979.
"Regulating a Monopolist with Unknown Costs,"
412, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Kopp, Raymond J. & Mullahy, John, 1990. "Moment-based estimation and testing of stochastic frontier models," Journal of Econometrics, Elsevier, vol. 46(1-2), pages 165-183.
- Efthymios G. Tsionas, 2007. "Efficiency Measurement with the Weibull Stochastic Frontier," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 69(5), pages 693-706, October.
- Leon Yang Chu & David E. M. Sappington, 2007. "Simple Cost-Sharing Contracts," American Economic Review, American Economic Association, vol. 97(1), pages 419-428, March.
- Jeffrey M. Wooldridge, 2003. "Cluster-Sample Methods in Applied Econometrics," American Economic Review, American Economic Association, vol. 93(2), pages 133-138, May.
- Myerson, Roger B, 1979.
"Incentive Compatibility and the Bargaining Problem,"
Econometric Society, vol. 47(1), pages 61-73, January.
- Roger B. Myerson, 1977. "Incentive Compatability and the Bargaining Problem," Discussion Papers 284, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Caves, Douglas W & Christensen, Laurits R & Diewert, W Erwin, 1982. "Multilateral Comparisons of Output, Input, and Productivity Using Superlative Index Numbers," Economic Journal, Royal Economic Society, vol. 92(365), pages 73-86, March.
- Timo Sipil�inen & Anni Huhtala, 2013.
"Opportunity costs of providing crop diversity in organic and conventional farming: would targeted environmental policies make economic sense?,"
European Review of Agricultural Economics,
Foundation for the European Review of Agricultural Economics, vol. 40(3), pages 441-462, July.
- Sipilainen, Timo & Huhtala, Anni, 2011. "Opportunity Costs of Providing Crop Diversity in Organic and Conventional Farming: Would Targeted Environmental Policies Make Economic Sense?," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114527, European Association of Agricultural Economists.
- Sipilainen, Timo & Huhtala, Anni, 2012. "Opportunity Costs of Providing Crop Diversity in Organic and Conventional Farming," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126652, International Association of Agricultural Economists.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).
If references are entirely missing, you can add them using this form.