Year: 1988
Author: Meran, Georg
Journal of Contextual Economics – Schmollers Jahrbuch, Vol. 108 (1988), Iss. 3 : pp. 439–450
Abstract
Using a simple monopsonistic labor market model developed by H. Siebert in this journal, this paper explores the employment effects of an market for pollution rights. It is shown, that under certain technological conditions a local monopsonist is led to increase wages so as to prevent small firms to enter the license market. As a result, the price for pollution rights is too low. The second part of the paper deals with the construction of an optimal emission policy for pollution rights which allows to replicate the allocation prevailing in a competitive market system. Thus, the alleged deficiencies of license markets in an monopsonistic environment are due to an omitted instrument.
Journal Article Details
Publisher Name: Global Science Press
Language: Multiple languages
DOI: https://doi.org/10.3790/schm.108.3.439
Journal of Contextual Economics – Schmollers Jahrbuch, Vol. 108 (1988), Iss. 3 : pp. 439–450
Published online: 1988-03
AMS Subject Headings: Duncker & Humblot
Copyright: COPYRIGHT: © Global Science Press
Pages: 12