Birg, Laura; Vosswinkel, Jan S. - 2018 - Revised version June 2018
This paper studies the effect of an emission tax on the relocation decision in a duopoly with exogenous vertical … product differentiation. We establish the relationship between quality difference, relocation cost, and marginal damage of … relocation. If also the foreign country applies an emission tax, there is no equilibrium in which both firms relocate to the …