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Environmental policy negotiations, transboundary pollution and lobby groups in small open economies

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  • Persson, Lars

    ()
    (Department of Economics, Umeå University)

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    Abstract

    This paper analyzes the consequences of lobby group activity for policy outcomes in economies with transboundary pollution and international environmental policies. In our framework, international environmental policies are characterized as pollution taxes determined in a negotiation between two countries. We find, among other things, that the presence of local lobbying tends to reduce the level of pollution taxes. We also find that an increase in the environmental concern (i.e. stronger preferences for a clean environment) may reduce the pollution tax in both countries. It is also possible that increased environmental concern in one country reduces the pollution tax in the other country.

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    File URL: http://www.econ.umu.se/DownloadAsset.action?contentId=48149&languageId=3&assetKey=ues722
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    Bibliographic Info

    Paper provided by Umeå University, Department of Economics in its series Umeå Economic Studies with number 722.

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    Length: 29 pages
    Date of creation: 02 Nov 2007
    Date of revision: 01 Jul 2008
    Handle: RePEc:hhs:umnees:0722

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    Postal: Department of Economics, Umeå University, S-901 87 Umeå, Sweden
    Phone: 090 - 786 61 42
    Fax: 090 - 77 23 02
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    Web page: http://www.econ.umu.se/
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    Related research

    Keywords: transboundary pollution; lobbying; taxes; pollution; Nash bargain; negotiations; environmental policy;

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