Developing Countries and Environmental Protection: Contract Design in Perfectly Correlated Environments
AbstractI study the problem faced by an asymmetrically informed supranational governmental authority (SNGA) with limited funds that wishes to design an international environmental agreement (IEA) for less developed countries (LDCs). The SNGA cannot contract directly with polluting firms in the various LDCs, but it must deal with such firms through their national governments. I study this tripartite hierarchical interaction for two LDCs. My principal result is that despite the perfect correlation in the private information of the governments and the firms across the two countries, and in contrast with the result contained in Batabyal (1998a), the SNGA cannot implement a first-best IEA. Copyright Kluwer Academic Publishers 1999
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 Springer in its journal Open Economies Review.
Volume (Year): 10 (1999)
Issue (Month): 3 (July)
Contact details of provider:
Web page: http://www.springerlink.com/link.asp?id=100323
hierarchy; international environmental agreement; LDC; perfect correlation;
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.:
- Batabyal, Amitrajeet A., 1997.
"Developing countries and environmental protection: the effects of budget balance and pollution ceiling constraints,"
Journal of Development Economics,
Elsevier, vol. 54(2), pages 285-305, December.
- Batabyal, Amitrajeet A., 1996. "Developing Countries and Environmental Protection: The Effects of Budget Balance and Pollution Ceiling Constraints," Working Papers 9617, Utah State University, Department of Economics.
- Batabyal, Amitrajeet A., 1996. "Developing Countries And Environmental Protection: The Effect Of Budget Balance And Pollution Ceiling Constraints," Economics Research Institute, ERI Study Papers 28347, Utah State University, Economics Department.
- Barrett, Scott, 1994. "Self-Enforcing International Environmental Agreements," Oxford Economic Papers, Oxford University Press, vol. 46(0), pages 878-94, Supplemen.
- Sappington, David & Demski, Joel S., 1983. "Multi-agent control in perfectly correlated environments," Economics Letters, Elsevier, vol. 13(4), pages 325-330.
- Michael Hoel, 1992. "International environment conventions: The case of uniform reductions of emissions," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 2(2), pages 141-159, March.
- Kofman, Fred & Lawarree, Jacques, 1993. "Collusion in Hierarchical Agency," Econometrica, Econometric Society, vol. 61(3), pages 629-56, May.
- Batabyal, Amitrajeet A., 1998. "Developing countries and international environmental agreements: The case of perfect correlation," International Review of Economics & Finance, Elsevier, vol. 7(1), pages 85-102.
- Demski, Joel S. & Sappington, David, 1984. "Optimal incentive contracts with multiple agents," Journal of Economic Theory, Elsevier, vol. 33(1), pages 152-171, June.
- Batabyal, Amitrajeet A., 1998. "On the irrelevance of collusion in perfectly correlated environments," International Review of Economics & Finance, Elsevier, vol. 7(4), pages 393-405.
- Jean Tirole, 1988. "The Multicontract Organization," Canadian Journal of Economics, Canadian Economics Association, vol. 21(3), pages 459-66, August.
- Tirole, Jean, 1986. "Hierarchies and Bureaucracies: On the Role of Collusion in Organizations," Journal of Law, Economics and Organization, Oxford University Press, vol. 2(2), pages 181-214, Fall.
- Bernauer, Thomas, 1995. "The effect of international environmental institutions: how we might learn more," International Organization, Cambridge University Press, vol. 49(02), pages 351-377, March.
- D. Lee & A. Batabyal, .
"Dynamic environmental policy in developing countries with a dual economy,"
2000-29, Utah State University, Department of Economics.
- Lee, Dug Man & Batabyal, Amitrajeet A., 2002. "Dynamic environmental policy in developing countries with a dual economy," International Review of Economics & Finance, Elsevier, vol. 11(2), pages 191-206, May.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Guenther Eichhorn) or (Christopher F. Baum).
If references are entirely missing, you can add them using this form.