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Corrective Taxes and Auctions of Rights in the Control of Externalities: A Reply

Author

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  • Randall G. Holcombe

    (Auburn University)

  • Roger E. Meiners

    (Texas A&M University)

Abstract

Our original article noted that auctions of pollution rights could increase a tendency toward monopoly in the offending industry. Professor Oates has provided some insightful comments in arguing for auctions rather than Pigouvian taxes, but the validity of the argument in our original article is not affected. Oates's suggestions for pricing externalities in the real world are a welcome addition to the discussion, but there are some reasons to believe that his approach would not be optimal under all circumstances.

Suggested Citation

  • Randall G. Holcombe & Roger E. Meiners, 1981. "Corrective Taxes and Auctions of Rights in the Control of Externalities: A Reply," Public Finance Review, , vol. 9(4), pages 479-484, October.
    • Handle: RePEc:sae:pubfin:v:9:y:1981:i:4:p:479-484
    DOI: 10.1177/109114218100900407
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    Cited by:

    1. Svendsen, Gert Tinggaard & Christensen, Jan Lien, 1999. "The US SO2 auction: analysis and generalization," Energy Economics, Elsevier, vol. 21(5), pages 403-416, October.

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