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Endogenous monitoring and enforcement of a transferable emissions permit system

Journal Article · · Journal of Environmental Economics and Management
The literature on noncompliant firms in transferable emissions permit systems offers little guidance to policymakers that must determine how to commit resources to monitor firms and punish violations in such systems. The authors consider how a budget-constrained enforcement authority that seeks to minimize aggregate noncompliance in a transferable emissions permit system should allocate its monitoring and enforcement efforts among heterogeneous firms. With a conventional model of firm behavior in a transferable permit system, they find that differences in the allocation of monitoring and enforcement effort between any two types of firms should be independent of differences in their exogenous characteristics.
Research Organization:
Univ. of Massachusetts, Amherst, MA (US)
OSTI ID:
20005486
Journal Information:
Journal of Environmental Economics and Management, Journal Name: Journal of Environmental Economics and Management Journal Issue: 3 Vol. 38; ISSN JEEMDI; ISSN 0095-0696
Country of Publication:
United States
Language:
English

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