Mixed duopoly and environment
We show under general demand and cost conditions that in a mixed duopoly with pollution the government can (and will) implement the socially optimal outputs and abatements by a tax-subsidy scheme and keeping the public firm fully public. The scheme requires taxing outputs and subsidizing abatements at different rates, unlike a pollution tax. Our result contradicts some of the recent claims that social optimum is not implementable and privatization is necessary. We also show that when the private firm is foreign-owned, the government will adopt some privatization and will not implement the social optimum, though the social optimum is implementable.
|Date of creation:||Jan 2011|
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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Juan Bárcena-Ruiz & María Garzón, 2006. "Mixed Oligopoly and Environmental Policy," Spanish Economic Review, Springer, vol. 8(2), pages 139-160, June.
- Juan Carlos Bárcena-Ruiz & María Begoña Garzón, 2002. "Environmental taxes and strategic delegation," Spanish Economic Review, Springer, vol. 4(4), pages 301-309.
- Bárcena Ruiz, Juan Carlos & Garzón San Felipe, María Begoña, 2001. "Mixed Oligopoly and Environmental Policy," BILTOKI 2001-05, Universidad del País Vasco - Departamento de Economía Aplicada III (Econometría y Estadística).
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