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Consistency of Regional Industrial Diversification and Air Quality Policies

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Author Info
Gilchrist, Donald A
St Louis, Larry V

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Abstract

Regional industrial diversification policies promote industries that will increase economic welfare by improving the balance between the standard of living and the stability of that standard of living. Regional air quality policies seek to reduce undesirable air emissions. This paper analyzes the interaction of regional air quality and industrial diversification policies, using a simple but tractable stochastic equilibrium model of regional income formation. We apply the model to data that describe the relationship between industrial structure and air emissions in Saskatchewan, and find that, in general, taxes designed to reduce harmful air emissions increase the variability of income. The major exception is a tax on refined fuels, which both reduces emissions and income variability. Copyright 1995 by Taylor and Francis Group

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Publisher Info
Article provided by Taylor and Francis Journals in its journal Economic Systems Research.

Volume (Year): 7 (1995)
Issue (Month): 2 ()
Pages: 173-88
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Handle: RePEc:taf:ecsysr:v:7:y:1995:i:2:p:173-88

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  1. Fritz, Oliver, 1999. "Optimal Management of a Regional Income and Pollution Portfolio," ERSA conference papers ersa99pa187, European Regional Science Association. [Downloadable!]
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