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Environmental Policy: The Coevolution of Pollution and Compliance

Listed author(s):
  • Yannis Petrohilos-Andrianos

    ()

  • Anastasios Xepapadeas

We study the evolution of compliance of firms in a setup of taxable emissions. Firms can either choose to comply with the emissions rule or violate it. Violation is considered either as a single option or is let to vary between low and high emissions, inducing a different level of fine if the firm gets caught. The firms can switch between strategies according to an evolutionary proportional rule and the conditions for stability are investigated accounting for two distinct types of probability of inspection.

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File URL: http://wpa.deos.aueb.gr/docs/The.Coevolution.of.Pollution.and.Compliance.pdf
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Paper provided by Athens University of Economics and Business in its series DEOS Working Papers with number 1519.

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Date of creation: 07 Dec 2015
Handle: RePEc:aue:wpaper:1519
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  1. Fullerton, Don & West, Sarah E., 2002. "Can Taxes on Cars and on Gasoline Mimic an Unavailable Tax on Emissions?," Journal of Environmental Economics and Management, Elsevier, vol. 43(1), pages 135-157, January.
  2. Schlag, Karl H., 1998. "Why Imitate, and If So, How?, : A Boundedly Rational Approach to Multi-armed Bandits," Journal of Economic Theory, Elsevier, vol. 78(1), pages 130-156, January.
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