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Environmental Investments in Mixed vs Private Oligopoly: What are the Implications of Privatization?

Author

Listed:
  • Maria José Gil-Moltó

    () (University of Sheffield)

  • Dimitrios Varvarigos

    () (University of Leicester)

Abstract

We compare economic and environmental outcomes under mixed and private oligopolies, in order to examine the effects of privatization when firms invest in abatement and emissions are taxed. We show that the number of competing firms in the market is an important factor in the determination of these effects. While privatization often involves a welfare trade-off, in the sense that higher (lower) output production implies higher(lower) pollution, there are also circumstances where it leads to both lower output and higher emissions simultaneously. Our results also indicate that privatization tends be associated with reductions in social welfare.

Suggested Citation

  • Maria José Gil-Moltó & Dimitrios Varvarigos, 2014. "Environmental Investments in Mixed vs Private Oligopoly: What are the Implications of Privatization?," Working Papers 2014018, The University of Sheffield, Department of Economics.
  • Handle: RePEc:shf:wpaper:2014018
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    File URL: http://www.sheffield.ac.uk/economics/research/serps/articles/2014_018
    File Function: First version, November 2014
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    References listed on IDEAS

    as
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    Cited by:

    1. Clò, Stefano & Ferraris, Matteo & Florio, Massimo, 2017. "Ownership and environmental regulation: Evidence from the European electricity industry," Energy Economics, Elsevier, vol. 61(C), pages 298-312.
    2. Shoji Haruna & Rajeev K. Goel, 2018. "Optimal Pollution Control in a Mixed Oligopoly with Research Spillovers," CESifo Working Paper Series 6909, CESifo Group Munich.

    More about this item

    Keywords

    Privatization; Pollution; Abatement; Mixed Oligopoly;

    JEL classification:

    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • L32 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Public Enterprises; Public-Private Enterprises
    • Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Adoption and Costs; Distributional Effects; Employment Effects

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