2008_03_27_Notes

2008_03_27_Notes - UP FRONT Reading for next time Kolstad...

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UP FRONT, 3-27-08 Reading for next time:  Kolstad, Environmental  Economics, 230-234 (liability as a means of  regulation) and 188-189 (Hybrid price/quantity  regulations)  Outline for Today 1) Emission fees in practice 2) Why did Pigou (and we) focus on a constant, per- unit fee? 3) Setting regulation far in advance promotes cost- effectiveness 4) Fee vs marketable permit system when  abatement cost function is unknown 5) Hybrid price-quantity regulations
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1) Emission fees in practice (v brief) 2) Explain why Pigovian fee is a constant, per-unit fee (b/ c can be applied to multiple firms) 3) Uncertainty about future regs a) To address many enviro problems, investment required: b) With uncertainty about future regulations, profitability of such investments very uncertain c) Result: Less investment. If regs come, reliance on more expensive alternatives to investment. (TABLE) 4) Fees vs permits when abatement cost function
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This note was uploaded on 02/19/2009 for the course AEM 4510 taught by Professor Shawhan,d. during the Spring '08 term at Cornell.

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2008_03_27_Notes - UP FRONT Reading for next time Kolstad...

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