Should Consumers Be Priced Out of Pollution-Permit Markets?
AbstractThe authors present a simple diagrammatic exposition of a pollution-permit market in which both firms that generate pollution and consumers who are harmed by pollution are allowed to purchase permits at a single market price. They show that the market equilibrium is efficient if and only if the endowment of permits is equal to the efficient level of pollution. Furthermore, if consumers actually participate in the market, then the equilibrium is not efficient. Welfare can be improved by decreasing the endowment of permits and thereby pricing consumers out of the market.
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.
Bibliographic InfoArticle provided by Taylor & Francis Journals in its journal The Journal of Economic Education.
Volume (Year): 34 (2003)
Issue (Month): 2 (January)
Contact details of provider:
Web page: http://www.tandfonline.com/VECE20
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Antoine Mandel, 2009.
"Welfare Improvement Properties of an Allowance Market in a Production Economy,"
UniversitÃ© Paris1 PanthÃ©on-Sorbonne (Post-Print and Working Papers)
- Antoine Mandel, 2007. "Welfare improvement properties of an allowance market in a production economy," UniversitÃ© Paris1 PanthÃ©on-Sorbonne (Post-Print and Working Papers) halshs-00155803, HAL.
- Antoine Mandel, 2007. "Welfare improvement properties of an allowance market in a production economy," Documents de travail du Centre d'Economie de la Sorbonne b07029, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty).
If references are entirely missing, you can add them using this form.