Honesty in Environmental Regulation
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Universidad de La Rioja
info
ISSN: 0922-680X
Year of publication: 2003
Volume: 24
Issue: 1
Pages: 35-48
Type: Article
More publications in: Journal of Regulatory Economics
Abstract
This paper analyzes the determination of the optimal environmental regulatory policy under imperfect competition when the firms differ in their polluting technologies and degree of honesty. We show that more honesty does not necessarily imply lower social losses. The effect of honesty in social welfare depends not only on the degree of honesty measured by the proportion of honest firms and their particular cost features but also on the industry structure.