Environmental Policy Instruments: Technology Adoption Incentives with Imperfect Compliance
AbstractIn this paper, we study the incentives to adopt advanced abatement technologies in the presence of imperfect compliance. Surprisingly, incentives to adopt advanced abatement technologies remain intact under emission taxes and pollution abatement subsidies when compared to the perfect compliance scenario. However, under emission standards imperfect compliance increases firmsâ incentives to invest under certain assumptions, whereas under an emission permit mechanism investment incentives decrease only if widespread non-compliance induces a (sufficient) reduction in the permit price. Our results are valid for fairly general characteristics of the monitoring and enforcement strategies commonly found in both, theoretical and empirical applications.
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Bibliographic InfoArticle provided by European Association of Environmental and Resource Economists in its journal Environmental and Resource Economics.
Volume (Year): 47 (2010)
Issue (Month): 2 (October)
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Web page: http://www.springerlink.com/link.asp?id=100263
Environmental policy; Monitoring; Non-compliance; Technology adoption; K42; L51; Q28;
Other versions of this item:
- Arguedas, Carmen & Camacho, Eva & Zofío, José Luis, 2009. "Environmental Policy Instruments: Technology Adoption Incentives with Imperfect Compliance," Working Papers in Economic Theory 2009/03, Universidad Autónoma de Madrid (Spain), Department of Economic Analysis (Economic Theory and Economic History).
- K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
- L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
- Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
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