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American Economic Journal: Economic Policy: Vol. 1 No. 2 (August 2009)
AEJ: Policy Volume. 1, Issue 2 | 
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AEJ: Policy Forthcoming Articles
Incomplete Environmental Regulation, Imperfect Competition, and Emissions Leakage
Article Citation
Fowlie, Meredith L. 2009. "Incomplete Environmental Regulation, Imperfect Competition, and Emissions Leakage."
American Economic Journal: Economic Policy,
1(2): 72-112.
DOI: 10.1257/pol.1.2.72
DOI: 10.1257/pol.1.2.72
Abstract
Environmental regulation of industrial pollution is often incomplete;
regulations apply to only a subset of facilities contributing to a
pollution problem. Policymakers are increasingly concerned about
the emissions leakage that may occur if unregulated production can
be easily substituted for regulated production. This paper analyzes
emissions leakage in an incompletely regulated and imperfectly
competitive industry. The analytical model is used to simulate outcomes
under incomplete, market-based regulation of carbon dioxide
emissions in California's electricity sector. Regulation that exempts
out-of-state producers achieves approximately one-third of the total
emissions reductions achieved under complete regulation at more
than twice the cost per ton. (JEL L94, Q53, Q58)
Article Full-Text Access
Full-text Article
Additional Materials
Download Data Set (16.21 MB) | Online Appendix (99.34 KB)
Authors
Fowlie, Meredith L. (U MI)
JEL Classifications
L94: Electric Utilities
Q53: Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
Q58: Environmental Economics: Government Policy
Q53: Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
Q58: Environmental Economics: Government Policy
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