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Alain-Désiré Nimubona and Bernard Sinclair-Desgagné
''The Pigouvian Tax Rule in the Presence of an Eco-Industry''
( 2013, Vol. 33 No.1 )
Pollution abatement goods and services are now largely being delivered by a specialized "eco-industry". This note reconsiders Pigouvian taxes in this context. We find that the optimal emission tax will depart from the marginal social cost of pollution according to the polluters' and the environment firms' relative market power.
Keywords: Pigouvian taxes, eco-industry
JEL: H2 - Taxation, Subsidies, and Revenue: General
L1 - Market Structure, Firm Strategy, and Market Performance: General
Manuscript Received : Dec 04 2012 Manuscript Accepted : Mar 15 2013

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