IDEAS home Printed from https://ideas.repec.org/a/cup/endeec/v15y2010i05p505-514_00.html
   My bibliography  Save this article

Optimal pollution tax under imperfect competition and international trade: the small country case

Author

Listed:
  • SAMPAOLESI, ALEJANDRO

Abstract

This work depicts the possibility of setting up an optimal pollution tax under non-competitive markets and international trade in a small country. The model employed describes a situation of partial equilibrium characterized by imperfect competition among domestic producers, where the domestic good is a substitute for an imported polluting commodity. In this framework, we also bring in the possibility that the domestic firms can introduce innovation offsets via their investment in R&D. From the results, the optimal pollution tax under domestic distortions can be expressed as a function of a ‘domestic production effect’ and a ‘pollution effect’. Furthermore, when the firms execute R&D expenditures, the optimal policy adds an ‘innovation effect’, which captures the change in welfare coming from a decrease in total costs and can lead our results to a win–win situation.

Suggested Citation

  • Sampaolesi, Alejandro, 2010. "Optimal pollution tax under imperfect competition and international trade: the small country case," Environment and Development Economics, Cambridge University Press, vol. 15(05), pages 505-514, October.
  • Handle: RePEc:cup:endeec:v:15:y:2010:i:05:p:505-514_00
    as

    Download full text from publisher

    File URL: http://journals.cambridge.org/abstract_S1355770X10000264
    File Function: link to article abstract page
    Download Restriction: no

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cup:endeec:v:15:y:2010:i:05:p:505-514_00. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Keith Waters). General contact details of provider: http://journals.cambridge.org/jid_EDE .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.