Pollution, Public Disclosure, and Firm Behavior
Abstract
This paper looks at whether a government regulator should publicly announce the amounts of pollution emitted by individual firms and plants. Disclosure may be important if there is incomplete information about firm costs, since pollution levels may be used by the regulated firm as a signal of costs to rival firms. We compare the signaling games under public disclosure and no disclosure. Welfare is likely reduced by disclosure, but if the regulator can adjust the stringency of the relevant pollution regulations, then the loss in welfare can be smaller. The implications of these results for pollution permits markets are discussed. Copyright 1993 by Kluwer Academic PublishersDownload Info
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Bibliographic Info
Article provided by Springer in its journal Journal of Regulatory Economics.
Volume (Year): 5 (1993)
Issue (Month): 3 (September)
Pages: 303-315
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Handle: RePEc:kap:regeco:v:5:y:1993:i:3:p:303-315
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For corrections or technical questions regarding this item, or to correct its listing, contact: (Guenther Eichhorn) or (Christopher F. Baum).
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