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Unitization of Tanneries and Water Pollution in the Ganges in Kanpur, India: The Salience of Fixed Costs

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  • Batabyal, Amitrajeet

Abstract

We study the merits of regulating water pollution in the Ganges river caused by tanneries in Kanpur, India, by unitizing or merging the polluting tanneries. We first describe the � ≥ 2 polluting tanneries in Kanpur as a Cournot oligopoly in which all tanneries incur fixed and variable costs in producing leather. Second, we derive the Nash equilibrium output of leather and profits and discuss how many tanneries can survive in this equilibrium as a function of the fixed costs. Third, we permit �

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  • Batabyal, Amitrajeet, 2025. "Unitization of Tanneries and Water Pollution in the Ganges in Kanpur, India: The Salience of Fixed Costs," MPRA Paper 126501, University Library of Munich, Germany, revised 15 Sep 2024.
    • Handle: RePEc:pra:mprapa:126501
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    References listed on IDEAS

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    1. Farrell, Joseph & Shapiro, Carl, 1988. "Horizontal Mergers: An Equilibrium Analysis," Department of Economics, Working Paper Series qt0tp305nx, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
    2. Farrell, Joseph & Shapiro, Carl, 1990. "Horizontal Mergers: An Equilibrium Analysis," American Economic Review, American Economic Association, vol. 80(1), pages 107-126, March.
    3. Amitrajeet A. Batabyal, 2025. "Tanneries in Kanpur, India, water pollution in the Ganges, and unitization," Asia-Pacific Journal of Regional Science, Springer, vol. 9(3), pages 733-742, September.
    4. Amitrajeet A. Batabyal, 2023. "Tanneries in Kanpur and pollution in the Ganges: A theoretical analysis," Regional Science Policy & Practice, Wiley Blackwell, vol. 15(5), pages 1114-1123, June.
    5. Batabyal, Amitrajeet & Kourtit, Karima & Nijkamp, Peter, 2022. "Climate Change and River Water Pollution: An Application to the Ganges in Kanpur," MPRA Paper 116453, University Library of Munich, Germany, revised 09 Jan 2023.
    6. Beladi, Hamid & Liu, Lu & Oladi, Reza, 2013. "On pollution permits and abatement," Economics Letters, Elsevier, vol. 119(3), pages 302-305.
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    Keywords

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    JEL classification:

    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water

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