Environmental Protection and the Private Provision of International Public Goods.

Citation:

Altemeyer-Bartscher M, Rubbelke DTG, Sheshinski E. Environmental Protection and the Private Provision of International Public Goods. Economica [Internet]. 2010 :775.

Abstract:

International environmental protection like the combat of global warming exhibits properties of public goods. In the international arena, no coercive authority exists that can enforce measures to overcome free-rider incentives. Therefore decentralized negotiations between individual regions serve as an approach to pursue efficient international environmental protection. We propose a scheme which is based on the ideas of Coasean negotiations and Pigouvian taxes. The negotiating entities offer side-payments to counterparts in order to influence their taxation of polluting consumption. Side-payments, in turn, are self-financed by means of externality-correcting taxes. As we show, a Pareto-efficient outcome can be attained.

Publisher's Version

Last updated on 06/14/2016