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Time Structure of Emissions and Comparison Between the Optimal Emission Taxes Under Selling and Under Renting in Durable Goods Oligopolies

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  • Amagoia Sagasta
  • José M. Usategui

Abstract

We compare the optimal emission taxes on selling firms and on renting firms in a model of a durable†goods oligopoly considering three types of emissions: emissions at production, emissions during use and emissions at disposal. We find that the optimal emission tax in the present may be lower when firms sell their output than when they rent their output if emissions are during use or at the disposal of the good. When emissions occur at production that optimal emission tax is higher on selling firms than on renting firms. Moreover, the total expected optimal emission tax per unit produced in the present is higher on selling firms than on renting firms for any of the three types of emissions considered. We provide intuition for these results.

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  • Amagoia Sagasta & José M. Usategui, 2018. "Time Structure of Emissions and Comparison Between the Optimal Emission Taxes Under Selling and Under Renting in Durable Goods Oligopolies," Manchester School, University of Manchester, vol. 86(1), pages 52-75, January.
  • Handle: RePEc:bla:manchs:v:86:y:2018:i:1:p:52-75
    DOI: 10.1111/manc.12181
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    Cited by:

    1. Akio Matsumoto & Ferenc Szidarovszky, 2022. "N-firm oligopolies with pollution control and random profits," Asia-Pacific Journal of Regional Science, Springer, vol. 6(3), pages 1017-1039, October.
    2. Sagasta Amagoia & Usategui José M., 2018. "Timing of Emissions and Effects of Emission Taxes in Durable-Goods Oligopolies," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 18(4), pages 1-21, October.
    3. Fukuda, Katsufumi & Ouchida, Yasunori, 2020. "Corporate social responsibility (CSR) and the environment: Does CSR increase emissions?," Energy Economics, Elsevier, vol. 92(C).

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