Efficiency of pollution taxation and market structure |
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Authors: | Dwight R Lee |
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Institution: | University of Colorado, Boulder, Colorado 80302, USA |
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Abstract: | This paper looks at the performance of a uniform pollution tax in achieving a given level of pollution abatement at least cost. It is shown that market structure is an important consideration in this performance and that in general least-cost abatement will not result from a pollution tax uniformly applied. The pattern of pollution taxes that will achieve least-cost abatement when differing degrees of market power exist among polluters is developed and discussed. |
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