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Non-Binding Voluntary Agreements

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Author Info

  • Matthieu Glachant

    (CERNA - Centre d'économie industrielle - Mines ParisTech)

Abstract

In reality, most voluntary agreements with polluters (VAs) are not enforceable in the sense that no legal tools are available to enforce Örmsí commitments. We examine whether such VAs are able to achieve an e¢ cient level of environmental protection when they are obtained under the legislative threat of a pollution quota. We show that they can improve social welfare relative to legislative intervention when lobbying Congress is very e§ective and when the polluter and the regulator do not discount future costs and beneÖts heavily. These Öndings suggest that VAs should be used selectively, taking into account sector characteristics and the degree of ináuence of lobbying on Congress.

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File URL: http://hal-ensmp.archives-ouvertes.fr/docs/00/43/77/69/PDF/Non_Binding_VAs_final.pdf
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Bibliographic Info

Paper provided by HAL in its series Post-Print with number hal-00437769.

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Date of creation: Jul 2007
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Publication status: Published, Journal of Environmental Economics and Management, 2007, 54, 1, 32-48
Handle: RePEc:hal:journl:hal-00437769

Note: View the original document on HAL open archive server: http://hal-ensmp.archives-ouvertes.fr/hal-00437769/en/
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References

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  1. Arora, Seema & Gangopadhyay, Shubhashis, 1995. "Toward a theoretical model of voluntary overcompliance," Journal of Economic Behavior & Organization, Elsevier, vol. 28(3), pages 289-309, December.
  2. Muthoo,Abhinay, 1999. "Bargaining Theory with Applications," Cambridge Books, Cambridge University Press, number 9780521576475, November.
  3. Lyon, Thomas P. & Maxwell, John W., 2003. "Self-regulation, taxation and public voluntary environmental agreements," Journal of Public Economics, Elsevier, vol. 87(7-8), pages 1453-1486, August.
  4. Segerson, Kathleen & Miceli, Thomas J., 1998. "Voluntary Environmental Agreements: Good or Bad News for Environmental Protection?," Journal of Environmental Economics and Management, Elsevier, vol. 36(2), pages 109-130, September.
  5. Lyon,Thomas P. & Maxwell,John W., 2004. "Corporate Environmentalism and Public Policy," Cambridge Books, Cambridge University Press, number 9780521603768, November.
  6. Manzini, Paola & Mariotti, Marco, 2003. "A bargaining model of voluntary environmental agreements," Journal of Public Economics, Elsevier, vol. 87(12), pages 2725-2736, December.
  7. John W. Maxwell & Thomas P Lyon & Steven C.. Hackett, 1995. "Self-Regulation and Social Welfare: The Political Economy of Corporate Environmentalism," University of Chicago - George G. Stigler Center for Study of Economy and State 122, Chicago - Center for Study of Economy and State.
  8. Amacher, Gregory S. & Malik, Arun S., 1996. "Bargaining in Environmental Regulation and the Ideal Regulator," Journal of Environmental Economics and Management, Elsevier, vol. 30(2), pages 233-253, March.
  9. Arguedas, Carmen, 2005. "Bargaining in environmental regulation revisited," Journal of Environmental Economics and Management, Elsevier, vol. 50(2), pages 422-433, September.
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Citations

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Cited by:
  1. Liu, Zugang (Leo) & Anderson, Trisha D. & Cruz, Jose M., 2012. "Consumer environmental awareness and competition in two-stage supply chains," European Journal of Operational Research, Elsevier, vol. 218(3), pages 602-613.
  2. David McEvoy & John Stranlund, 2010. "Costly Enforcement of Voluntary Environmental Agreements," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 47(1), pages 45-63, September.
  3. Thomas P. Lyon & John W. Maxwell, 2007. "Corporate Social Responsibility and the Environment: A Theoretical Perspective," Working Papers 2007-16, Indiana University, Kelley School of Business, Department of Business Economics and Public Policy.
  4. Rinaldo Brau & Carlo Carraro, 2011. "The design of voluntary agreements in oligopolistic markets," Journal of Regulatory Economics, Springer, vol. 39(2), pages 111-142, April.
  5. Blackman, Allen, 2009. "Alternative Pollution Control Policies in Developing Countries: Informal, Informational, and Voluntary," Discussion Papers dp-09-10, Resources For the Future.
  6. Pierre Fleckinger & Matthieu Glachant, 2009. "La responsabilité sociale de l'entreprise et les accords volontaires sont-ils complémentaires ?," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-00447028, HAL.
  7. Nicholas Powers & Allen Blackman & Thomas Lyon & Urvashi Narain, 2011. "Does Disclosure Reduce Pollution? Evidence from India’s Green Rating Project," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 50(1), pages 131-155, September.
  8. Nathaniel Keohane & Erin T. Mansur & Andrey Voynov, 2007. "Averting Regulatory Enforcement: Evidence from New Source Review," NBER Working Papers 13512, National Bureau of Economic Research, Inc.
  9. Pierre Fleckinger & Matthieu Glachant, 2011. "Negotiating a Voluntary Agreement When Firms Self-Regulate," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-00529632, HAL.
  10. Rasha Ahmed, 2012. "Promoting energy-efficient products: voluntary or regulatory approaches?," Environmental Economics and Policy Studies, Society for Environmental Economics and Policy Studies - SEEPS, vol. 14(3), pages 303-321, July.
  11. Lozano, Javier & Blanco, Ester & Rey-Maquieira, Javier, 2010. "Can ecolabels survive in the long run?: The role of initial conditions," Ecological Economics, Elsevier, vol. 69(12), pages 2525-2534, October.
  12. Pierre Fleckinger & Matthieu Glachant, 2009. "La responsabilité sociale de l'entreprise et les accords volontaires sont-ils complémentaires ?," Post-Print hal-00447028, HAL.
  13. Thomas P. Lyon & John W. Maxwell, 2012. "Self-Regulation, Negotiated Agreements and Social Welfare," Working Papers 2012-11, Indiana University, Kelley School of Business, Department of Business Economics and Public Policy.
  14. Blanco, Ester & Lozano, Javier & Rey-Maquieira, Javier, 2009. "A dynamic approach to voluntary environmental contributions in tourism," Ecological Economics, Elsevier, vol. 69(1), pages 104-114, November.

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