This paper develops a micro-founded city systems model with an endogenous number of cities to explore whether local governments establish the optimal city size when production processes involve environmental pollution. Our analysis delivers two key insights. First, if an optimal scheme to...

Most CGE models do not allow for negative leakage. In this paper, we use a full CGE model with many countries and many goods to measure effects in a way that allows for negative leakage. We vary elasticities of substitution and confirm the analytical model's prediction that negative leakage...

The separability between efficiency and equity is an underlying assumption in most of the computable general equilibrium (CGE) models that have hitherto been used, to assess the economic costs of international agreements to reduce carbon emissions. The analytical correctness of this hypothesis...

This paper studies the effect of climate policy uncertainty on firm polluting behavior. I find that firms reduce toxic emissions and close toxic facilities during the heightened climate policy uncertainty periods. Firms respond to climate policy uncertainty by adopting abatement technology to...

Government macro-control through various policies is an important way to mitigate air pollution and greenhouse gases. Therefore, environmental tax is used worldwide as an important measure. However, few studies have considered the interaction between carbon and environmental protection taxes....

This paper adds to the literature on transboundary pollution by considering pollution related to both production and consumption activities. In particular, we consider a symmetric strategic two firm-two country game model with bilateral trade and transboundary pollution to analyze the effects of...