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Does partial privatization improve the environment?

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  • Rupayan Pal

    (Indira Gandhi Institute of Development Research)

  • Bibhas Saha

Abstract

This paper shows that, in case of differentiated products mixed duopoly, environmental damage increases (decreases) with the level of privatization, if the level of privatization is less (more) than certain level. It also shows that partial privatization is optimal from the social welfare point of view. However, the social welfare maximizing level of privatization damages the environment most.

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Bibliographic Info

Paper provided by East Asian Bureau of Economic Research in its series Microeconomics Working Papers with number 23021.

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Date of creation: Jan 2010
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Handle: RePEc:eab:microe:23021

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Keywords: Privatization; mixed duopoly; environmental damage; environmental tax; social welfare;

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References

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  1. Bárcena Ruiz, Juan Carlos & Garzón San Felipe, María Begoña, 2001. "Mixed Oligopoly and Environmental Policy," BILTOKI, Universidad del País Vasco - Departamento de Economía Aplicada III (Econometría y Estadística) 2001-05, Universidad del País Vasco - Departamento de Economía Aplicada III (Econometría y Estadística).
  2. Joan Canton & Antoine Soubeyran & Hubert Stahn, 2008. "Environmental Taxation and Vertical Cournot Oligopolies: How Eco-industries Matter," Environmental & Resource Economics, European Association of Environmental and Resource Economists, European Association of Environmental and Resource Economists, vol. 40(3), pages 369-382, July.
  3. de Fraja, Giovanni & Delbono, Flavio, 1989. "Alternative Strategies of a Public Enterprise in Oligopoly," Oxford Economic Papers, Oxford University Press, vol. 41(2), pages 302-11, April.
  4. Matsumura, Toshihiro, 1998. "Partial privatization in mixed duopoly," Journal of Public Economics, Elsevier, Elsevier, vol. 70(3), pages 473-483, December.
  5. Rupayan Pal, 2012. "How much should you own? Cross-ownership and privatization," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2012-008, Indira Gandhi Institute of Development Research, Mumbai, India.
  6. Conrad Klaus, 1993. "Taxes and Subsidies for Pollution-Intensive Industries as Trade Policy," Journal of Environmental Economics and Management, Elsevier, vol. 25(2), pages 121-135, September.
  7. Ngo Long & Antoine Soubeyran, 2005. "Selective penalization of polluters: an inf-convolution approach," Economic Theory, Springer, Springer, vol. 25(2), pages 421-454, 02.
  8. Fershtman, Chaim, 1990. "The Interdependence between Ownership Status and Market Structure: The Case of Privatization," Economica, London School of Economics and Political Science, London School of Economics and Political Science, vol. 57(227), pages 319-28, August.
  9. Beladi, Hamid & Chao, Chi-Chur, 2006. "Does privatization improve the environment?," Economics Letters, Elsevier, Elsevier, vol. 93(3), pages 343-347, December.
  10. Shuichi Ohori, 2006. "Optimal Environmental Tax and Level of Privatization in an International Duopoly," Journal of Regulatory Economics, Springer, Springer, vol. 29(2), pages 225-233, 03.
  11. Kennedy Peter W., 1994. "Equilibrium Pollution Taxes in Open Economies with Imperfect Competition," Journal of Environmental Economics and Management, Elsevier, vol. 27(1), pages 49-63, July.
  12. Juan Carlos Bárcena-Ruiz & María Begoña Garzón, 2002. "Environmental taxes and strategic delegation," Spanish Economic Review, Springer, Springer, vol. 4(4), pages 301-309.
  13. Ulph, A., 1994. "Strategic environmental policy and international trade: the role of market conduct," Discussion Paper Series In Economics And Econometrics 9415, Economics Division, School of Social Sciences, University of Southampton.
  14. Jeffry M. Netter & William L. Megginson, 2001. "From State to Market: A Survey of Empirical Studies on Privatization," Journal of Economic Literature, American Economic Association, vol. 39(2), pages 321-389, June.
  15. Damania, R., 2000. "Financial structure and the effectiveness of pollution control in an oligopolistic industry," Resource and Energy Economics, Elsevier, Elsevier, vol. 22(1), pages 21-36, January.
  16. Antelo, Manel & Loureiro, Maria L., 2009. "Asymmetric information, signaling and environmental taxes in oligopoly," Ecological Economics, Elsevier, Elsevier, vol. 68(5), pages 1430-1440, March.
  17. Maw, James, 2002. "Partial privatization in transition economies," Economic Systems, Elsevier, vol. 26(3), pages 271-282, September.
  18. Rupayan Pal, 2010. "How Much Should You Own? Cross-ownership and Privatization," Working Papers id:2810, eSocialSciences.
  19. Rabindra N. Bhattacharya & Rupayan Pal, 2008. "Environmental Standards as Strategic Outcomes : A Simple Model," Development Economics Working Papers 22151, East Asian Bureau of Economic Research.
  20. Ulph, Alistair, 1996. "Environmental Policy and International Trade when Governments and Producers Act Strategically," Journal of Environmental Economics and Management, Elsevier, vol. 30(3), pages 265-281, May.
  21. Ulph, Alistair Mitchell, 1994. "Strategic Environmental Policy and International Trade - The Role of Market Conduct," CEPR Discussion Papers, C.E.P.R. Discussion Papers 1065, C.E.P.R. Discussion Papers.
  22. Nirvikar Singh & Xavier Vives, 1984. "Price and Quantity Competition in a Differentiated Duopoly," RAND Journal of Economics, The RAND Corporation, vol. 15(4), pages 546-554, Winter.
  23. Fujiwara, Kenji, 2009. "Environmental policies in a differentiated oligopoly revisited," Resource and Energy Economics, Elsevier, Elsevier, vol. 31(3), pages 239-247, August.
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