CHEATING ON NONPOINT MARGIN: HOW MUCH MIGHT IT COST?

Trading of pollution permits with banking and borrowing can achieve an optimal distribution of abatement across agents and time. However, when the environmental constraint is binding under imperfectly observed abatement practices, there is an incentive for sources to misrepresent their activities. This cheating can erode the efficiency of a permit system in achieving an environmental standard, but it is shown that this incentive to cheat causes similar efficiency losses in a command-and-control mechanism employing a uniform reduction policy.


Issue Date:
2000
Publication Type:
Conference Paper/ Presentation
PURL Identifier:
http://purl.umn.edu/21856
Total Pages:
24
Series Statement:
Selected Paper




 Record created 2017-04-01, last modified 2017-08-24

Fulltext:
Download fulltext
PDF

Rate this document:

Rate this document:
1
2
3
 
(Not yet reviewed)