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Risk perceptions, voluntary contributions and environmental policy

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  • Etner, Johanna
  • Jeleva, Meglena
  • Jouvet, Pierre-Andre

Abstract

This article study the impact of risk perception on environmental policy. The environmental quality is uncertain and can be improved by voluntary contributions. We introduce then an heterogeneity in individuals' risk perceptions. In this context, the social optimum can be decentralized by tax financed government subsidies to private provision. We distinguish the case of a government who represents perfectly agents' preferences from the case of a government with its own risk preferences. In the two cases, we show that neutrality still holds.

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Bibliographic Info

Article provided by Elsevier in its journal Research in Economics.

Volume (Year): 61 (2007)
Issue (Month): 3 (September)
Pages: 130-139

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Handle: RePEc:eee:reecon:v:61:y:2007:i:3:p:130-139

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Web page: http://www.elsevier.com/locate/inca/622941

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References

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  1. Robin Boadway & Pierre Pestieau & David Wildasin, 1987. "Tax-Transfer Policies and the Voluntary Provision of Public Goods," Working Papers 682, Queen's University, Department of Economics.
  2. Warr, Peter G., 1982. "Pareto optimal redistribution and private charity," Journal of Public Economics, Elsevier, vol. 19(1), pages 131-138, October.
  3. JOUVET, Pierre-André & MICHEL, Philippe & PESTIEAU, Pierre, . "Altruism, voluntary contributions and neutrality: the case of environmental quality," CORE Discussion Papers RP -1484, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  4. Yaari, Menahem E, 1987. "The Dual Theory of Choice under Risk," Econometrica, Econometric Society, vol. 55(1), pages 95-115, January.
  5. Johana Etner & Meglena Jeleva, 2004. "Pessimism or optimism : a justification to voluntary contributions toward environmental quality," Cahiers de la Maison des Sciences Economiques v04099, Université Panthéon-Sorbonne (Paris 1).
  6. Warr, Peter G., 1983. "The private provision of a public good is independent of the distribution of income," Economics Letters, Elsevier, vol. 13(2-3), pages 207-211.
  7. B. Douglas Bernheim & Kyle Bagwell, 1989. "Is Everything Neutral?," NBER Working Papers 2086, National Bureau of Economic Research, Inc.
  8. Feldstein, Martin, 1988. "The Effects of Fiscal Policies when Incomes Are Uncertain: A Contradiction to Ricardian Equivalence," American Economic Review, American Economic Association, vol. 78(1), pages 14-23, March.
  9. Kimball, Miles S & Mankiw, N Gregory, 1989. "Precautionary Saving and the Timing of Taxes," Journal of Political Economy, University of Chicago Press, vol. 97(4), pages 863-79, August.
  10. Kahneman, Daniel & Tversky, Amos, 1979. "Prospect Theory: An Analysis of Decision under Risk," Econometrica, Econometric Society, vol. 47(2), pages 263-91, March.
  11. Bergstrom, Theodore & Blume, Lawrence & Varian, Hal, 1986. "On the private provision of public goods," Journal of Public Economics, Elsevier, vol. 29(1), pages 25-49, February.
  12. Herman Cousy, 1996. "The Precautionary Principle: A Status Questionis*," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan, vol. 21(2), pages 158-169, April.
  13. Quiggin, John, 1982. "A theory of anticipated utility," Journal of Economic Behavior & Organization, Elsevier, vol. 3(4), pages 323-343, December.
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Cited by:
  1. Langlais, Eric, 2010. "Safety and the Allocation of Costs in Large Accidents," MPRA Paper 25710, University Library of Munich, Germany.

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