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Population Mobility and Transboundary Environmental Problems


  • Michael Hoel
  • Perry Shapiro


A standard result in the literature on environmental economics is that efficient environmental policies regulating transboundary pollution will be adopted only if there is interjurisdictional coordination. Efficient policies can be adopted as a result of interregional treaties or mandated by a central authority. The present paper demonstrates that if there is perfect population mobility between the regions affected by the transboundary pollution, the efficient outcome is a Nash equilibrium of the policy game between regional authorities. This is true independently of what policies are available to the regional authorities. However, there may be more than one Nash equilibrium, so that policy coordination may be necessary in order to achieve the best equilibrium.

Suggested Citation

  • Michael Hoel & Perry Shapiro, 2001. "Population Mobility and Transboundary Environmental Problems," CESifo Working Paper Series 488, CESifo Group Munich.
  • Handle: RePEc:ces:ceswps:_488

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    References listed on IDEAS

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    Cited by:

    1. Naoto Aoyama & Emilson Silva, 2008. "Correlated Pollutants, Interregional Redistribution and Labor Attachment in a Federation," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 41(3), pages 437-437, November.
    2. Anton Bondarev & Beat Hintermann & Frank C. Krysiak & Ralph Winkler, 2017. "The Intricacy of Adapting to Climate Change: Flood Protection as a Local Public Goods Game," CESifo Working Paper Series 6382, CESifo Group Munich.
    3. Dijkstra, Bouwe R. & de Vries, Frans P., 2006. "Location choice by households and polluting firms: An evolutionary approach," European Economic Review, Elsevier, vol. 50(2), pages 425-446, February.
    4. Eppink, Florian V. & Withagen, Cees A., 2009. "Spatial patterns of biodiversity conservation in a multiregional general equilibrium model," Resource and Energy Economics, Elsevier, vol. 31(2), pages 75-88, May.
    5. Hoel, Michael, 2004. "Interregional interactions and population mobility," Journal of Economic Behavior & Organization, Elsevier, vol. 55(3), pages 419-433, November.
    6. van 't Veld, Klaas & Shogren, Jason F., 2012. "Environmental federalism and environmental liability," Journal of Environmental Economics and Management, Elsevier, vol. 63(1), pages 105-119.
    7. Li, Xiaochun & Zhou, Yu, 2013. "Development policies, transfer of pollution abatement technology and trans-boundary pollution," Economic Modelling, Elsevier, vol. 31(C), pages 183-188.
    8. Francis Bloch & Ünal Zenginobuz, 2015. "Oates’ decentralization theorem with imperfect household mobility," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 22(3), pages 353-375, June.
    9. Haavio, Markus, 2005. "Transboundary pollution and household mobility: Are they equivalent?," Journal of Environmental Economics and Management, Elsevier, vol. 50(2), pages 252-275, September.
    10. Kunce, Mitch & Shogren, Jason F., 2007. "Destructive interjurisdictional competition: Firm, capital and labor mobility in a model of direct emission control," Ecological Economics, Elsevier, vol. 60(3), pages 543-549, January.
    11. Michael Hoel & Perry Shapiro, 2004. "Transboundary Environmental Problems with Mobile but Heterogeneous Populations," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 27(3), pages 265-272, March.
    12. Costas Hadjiyiannis & Panos Hatzipanayotou & Michael S. Michael, 2002. "Optimal Tax Policies with Private-Public Clean-Up, Cross-Border Pollution and Capital Mobility," CESifo Working Paper Series 822, CESifo Group Munich.
    13. Martin Daniel Siyaranamual, 2009. "Constructing the Model of Environmental Migration," Working Papers in Economics and Development Studies (WoPEDS) 200901, Department of Economics, Padjadjaran University, revised Mar 2009.
    14. Volker Arnold, 2005. "Competitive Versus Cooperative Federalism: Is a Fiscal Equalization Scheme Necessary from an Allocative Point of View?/ Kompetitiver versus kooperativer Föderalismus: Ist ein horizontaler Finanzausgle," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 225(3), pages 259-282, June.


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