In this thesis, I study methodologically and empirically the demand and supply of environmental quality. The first part comprises two chapters examining preferences for changes in local environmental amenities. In the second part, three chapters study the economic costs of reducing polluting...

Firms subject to cost-of-service regulation cannot withhold windfall profits associated with free emissions allowances. This paper examines the efficiency and distributional impacts of two approaches to transfer free allowances to consumers: output subsidies and lump-sum payments. We employ an...