Berliant, Marcus C.; Peng, Shin Kun; Wang, Ping - 2011
This paper demonstrates that a pollution tax with a fixed cost component may lead, by itself, to segregation between … locations and two industries (clean and dirty) where pollution is a by-product of dirty good manufacturing. Under proper … outcome when there is a fixed cost component of the pollution tax. Moreover, a stratified Pareto optimum can never be …