The General Equilibrium Incidence of Environmental Mandates
- UNCG Author/Contributor (non-UNCG co-authors, if there are any, appear on document)
- Garth Heutel, Assistant Professor (Creator)
- Institution
- The University of North Carolina at Greensboro (UNCG )
- Web Site: http://library.uncg.edu/
Abstract: Pollution regulations affect factor demands, relative returns, production,
and output prices. In our model, one sector includes pollution
as an input that can be a complement or substitute for labor or capital.
For each type of mandate, we find conditions where more burden
is on labor or on capital. Stricter regulation does not always place
less burden on the better substitute for pollution. Also, restrictions on
pollution per unit output create an "output-subsidy effect" on factor
prices that can reverse the usual output and substitution effects. We
find analogous effects for a restriction on pollution per unit capital.
The General Equilibrium Incidence of Environmental Mandates
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Created on 8/25/2010
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Additional Information
- Publication
- American Economic Journal: Economic Policy 2 (August 2010): 64–89
- Language: English
- Date: 2010
- Keywords
- Economic impact, Environmental mandate, Pollution