The directional distance function defined in a DEA type non-parametric framework provides a highly flexible structure for modelling producer behaviour in the presence of polluting emissions and environmental regulations. This article presents five models describing different “command and...

In the midwestern United States, ethanol produced from corn is mixed with gasoline to meet clean air standards. Allocating land to produce clean fuel means taking away land from farming. We examine a model in which a scarce fossil fuel (e.g., oil) causes pollution but may be substituted by a...

We analyze the effects of an environmental policy on the diffusion of a clean technology. Compared to previous articles we consider that the polluting firms are competitors on the output market and we analyze the effects of the policy on the share of adopting firms in the economy. We show that...