Consider a model for optimal timing of emissions reduction, trading off the cost of the reduction against the time-additive aggregate of environmental damage, the disutility from the pollutant stock M(t) the infrastructure contributes to. Intuitively, the optimal timing for an infinitesimal...

We compare two tradable permit markets in their ability to meet a safety first environmental target at least cost when some polluters have stochastic, correlated, and non-measurable emissions. In both markets, the point source permit defines the allowable level of the observed (deterministic)...

Many environmental-policy problems are characterized by complexity and uncertainty. Government's choice concerning these policies commonly relies on information provided by a bureaucracy. Environmental bureaucrats often have a political motivation of their own, so they might be tempted to...

How many instruments should be used to address a particular environmental problem? That is the question this article addresses. According to the "Tinbergen rule," one instrument per target is needed. The existence of any non-environmental market failures affecting the environmental problem at...

This paper looks at how contemporary environmental (including climate) policy problems are phrased in terms of effectiveness, efficiency, and equity. The latter three concepts have served as foci of theoretical discussions among economists who analyse these issues and identify criteria that...

Environmental concerns are becoming increasingly popular and nowadays find their place on the policy-makers agenda. The basic question that arises in these circumstances is whether environmental theses are consistent or not with the economic theory. Environmental issues must go through the...

We show that for a broad class of technologies the relationship between policy stringency and the rate of technology adoption is inverted U-shaped. This happens when the marginal abatement cost (MAC) curves of conventional and new technologies intersect, which invariably occurs when emissions...

Environmental challenges, and the potential solutions to address them, have a direct effect on living standards, the organization of economies, major infrastructures, and modes of urbanization. Since the publication of path-breaking contributions on the governance of environmental resources in...

Jaffe and Palmer (1997) present three distinct variants of the so-called Porter Hypothesis. The weak version of the hypothesis posits that environmental regulation will stimulate certain kinds of environmental innovations. The narrow version of the hypothesis asserts that flexible environmental...

Using a technology where pollution is regarded as by-product of industry's activity and applied in a simple setup of Heckscher-Ohlin-Copeland-Taylor model, this paper analyses the possible distributional impacts of stricter environmental policy in a developing country characterized by the...