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On the efficiency of environmental instruments in a spatial economy

  • Raimund Krumm
  • Dietmar Wellisch
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    This paper develops an efficiency criterion to evaluate environmental policy instruments in a spatial economy. We call an environmental policy regime at the regional level efficient if it guarantees not only an efficient distribution of emission permits within a region, but also an efficient locational pattern of mobile firms across the regions of a federation. Using marketable pollution rights or emission taxes, efficiency in this broad sense can only be achieved if revenues of regional environmental agencies are not transferred to regional firms. Direct controls neither support an efficient allocation of emission rights within a region nor locational efficiency of firms. Copyright Kluwer Academic Publishers 1995

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    File URL: http://hdl.handle.net/10.1007/BF00691413
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    Article provided by European Association of Environmental and Resource Economists in its journal Environmental & Resource Economics.

    Volume (Year): 6 (1995)
    Issue (Month): 1 (July)
    Pages: 87-98

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    Handle: RePEc:kap:enreec:v:6:y:1995:i:1:p:87-98
    Contact details of provider: Web page: http://www.springerlink.com/link.asp?id=100263

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    1. Charles Howe, 1993. "The U.S. Environmental policy experience: A critique with Suggestions for the European Community," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 3(4), pages 359-379, August.
    2. Wellisch Dietmar, 1995. "Locational Choices of Firms and Decentralized Environmental Policy with Various Instruments," Journal of Urban Economics, Elsevier, vol. 37(3), pages 290-310, May.
    3. Virginia D. McConnell & Robert M. Schwab, 1990. "The Impact of Environmental Regulation on Industry Location Decisions: The Motor Vehicle Industry," Land Economics, University of Wisconsin Press, vol. 66(1), pages 67-81.
    4. Timothy J. Bartik, 2002. "The Effects of Environmental Regulation on Business Location in the United States," Book chapters authored by Upjohn Institute researchers, in: Wayne B. Gray (ed.), Economic Costs and Consequences of Environmental Regulation, pages 129-151 W.E. Upjohn Institute for Employment Research.
    5. Markusen James R. & Morey Edward R. & Olewiler Nancy D., 1993. "Environmental Policy when Market Structure and Plant Locations Are Endogenous," Journal of Environmental Economics and Management, Elsevier, vol. 24(1), pages 69-86, January.
    6. Oates, Wallace E. & Schwab, Robert M., 1988. "Economic competition among jurisdictions: efficiency enhancing or distortion inducing?," Journal of Public Economics, Elsevier, vol. 35(3), pages 333-354, April.
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