Delegation and Emission Tax in a Differentiated Oligopoly
AbstractHow product differentiation as well as strategic managerial delegation affects optimal emission tax rate, environmental damage and social welfare, under alternative modes of product market competition is examined. It shows that, under pure profit maximization, the (positive) optimal emission tax rate is not necessarily decreasing in degree of product differentiation, irrespective of the mode of competition.
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product market; Emission tax; price competition; product differentiation; quantity competition; strategic managerial delegation; competition; social welfare; rate; environmental damage; profit maximization;
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