|Appears in Collections:||Economics Journal Articles|
|Peer Review Status:||Refereed|
|Title:||Environmental taxes and industry monopolization|
de, Vries Frans
|Citation:||Schoonbeek L & de Vries F (2009) Environmental taxes and industry monopolization, Journal of Regulatory Economics, 36 (1), pp. 94-106.|
|Abstract:||This paper considers a market with an incumbent monopolistic firm and a potential entrant. Production by both firms causes polluting emissions. The government selects a tax per unit of emission to maximize social welfare. The size of the tax rate affects whether or not the potential entrant enters the market. We identify the conditions that create a market structure where the preferences of the government and the incumbent firm coincide. Interestingly, there are cases where both the government and incumbent firm prefer a monopoly. Hence, the government might induce profitable monopolization by using a socially optimal tax policy instrument.|
|Rights:||The publisher does not allow this work to be made publicly available in this Repository. Please use the Request a Copy feature at the foot of the Repository record to request a copy directly from the author; you can only request a copy if you wish to use this work for your own research or private study.|
|Affiliation:||University of Groningen|
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