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"Abstract: Taxation and liability are compared here as means of controlling harmful externalities. It is emphasized that liability has an advantage over taxation: inefficiency of incentives arises under taxation when, as would be typical, it would be impractical for a tax to reflect all...
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harmful externalities, its actual use has been limited, mainly to the domain of pollution. Liability, in contrast, has great … importance in controlling harmful externalities. I compare the tax and liability here in theory and suggest that the conclusions … help to explain the observed predominance of liability over taxation, except in the area of pollution. The following …
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This article studies how liability for environmentally harmful discharges affects the incentives of firms to engage in cleanup and invest in precautions, as well as the incentives of consumers to purchase the goods whose production leads to discharges. Our main conclusion is that making firms...
Persistent link: https://www.econbiz.de/10012474792
harmful externalities, its actual use has been limited, mainly to the domain of pollution. Liability, in contrast, has great … importance in controlling harmful externalities. I compare the tax and liability here in theory and suggest that the conclusions … help to explain the observed predominance of liability over taxation, except in the area of pollution. The following …
Persistent link: https://www.econbiz.de/10012462420