Investment subsidies and time-consistent environmental policy
Abrego, Lisandro and Perroni, Carlo (1999) Investment subsidies and time-consistent environmental policy. Working Paper. Coventry: University of Warwick, Department of Economics. Warwick economic research papers (No.533).
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We describe a model of dynamic poluution abatement choices with heterogeneous agents, where, due to the presence of a distributional objective and to the absence of incentive-compatible compensation mechanisms, the choice of a second-best level of emission taxation is time-inconsistent. In this model, we investigate whether investment subsidies can act as a substitute for policy commitment.
|Item Type:||Working or Discussion Paper (Working Paper)|
|Subjects:||H Social Sciences > HJ Public Finance|
|Divisions:||Faculty of Social Sciences > Economics|
|Library of Congress Subject Headings (LCSH):||Pollution -- Taxation, Environmental impact charges, Pollution prevention, Investments|
|Series Name:||Warwick economic research papers|
|Publisher:||University of Warwick, Department of Economics|
|Place of Publication:||Coventry|
|Official Date:||June 1999|
|Number of Pages:||22|
|Status:||Not Peer Reviewed|
|Access rights to Published version:||Open Access|
First draft, December 1997; this version, June 1999
|Funder:||Economic and Social Research Council (Great Britain) (ESRC)|
Agostini, P., M. Botteon, and C. Carraro (1992). "A Carbon Tax to Reduce CO2 Emissions in Europe," Energy Economics 14: 279-90.
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