Designing Regulatory Policies for Complex Externalities: The Case of Agricultural Pollution

The paper examines the issue of designing and implementing policy measures to control complex agricultural externalities. Complex externalities refer to the situation where a production (firm on firm) externality coexists with a detrimental (firm on society) externality. The paper identifies the optimal solution for complex externalities, which is a combination of spatially differentiated taxes. However, severe information requirements render the first-best policy infeasible. Finally, a likely voluntary scheme based on firm self-report is examined which may enforce firm compliance with the optimal policy.


Issue Date:
213
Publication Type:
Journal Article
PURL Identifier:
http://purl.umn.edu/253546
Published in:
Agricultural Economics Review, Volume 14, Issue 2
Page range:
75-88
Total Pages:
14




 Record created 2017-04-01, last modified 2017-04-28

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