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Effectiveness of environmental regulations under imperfect enforcement and the firm's avoidance behavior

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  • Chung-Huang Huang

Abstract

This paper explicitly defines enforcement quality and develops a model by incorporating enforcement quality and the firm's avoidance behavior. The results indicate that the effectiveness of environmental regulations is likely to depend upon the level of enforcement quality, as well as upon the nature of the firm's avoidance behavior. Policy instruments may become incompatible under certain circumstances. Enforcement quality should be properly targeted to enhance functional harmonization between instruments. The condition under which emission tax is more effective under imperfect enforcement than under complete enforcement is also identified. Copyright Kluwer Academic Publishers 1996

Suggested Citation

  • Chung-Huang Huang, 1996. "Effectiveness of environmental regulations under imperfect enforcement and the firm's avoidance behavior," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 8(2), pages 183-204, September.
    • Handle: RePEc:kap:enreec:v:8:y:1996:i:2:p:183-204
    DOI: 10.1007/BF00357363
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    References listed on IDEAS

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