Consider a situation where the marginal damage function is known and equal to D'(E)= d.E. The aggregate
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Consider a situation where the marginal damage function is known and equal to D'(E)= d.E. The aggregate marginal abatement cost curve is given by -C'(E)=ã-bE where is ãrandom variable uniformly distributed on the interval The regulator wants to apply the hybrid instrument with a supply of tradable permits, a tax rate as an upper valve, and a subsidy rate for nonused permits ζ> τ as a lower valve. Determine the optimal levels for τ,ζ and L.
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Related Book For
A Course In Environmental Economics
ISBN: 9781316866818
1st Edition
Authors: Daniel J Phaneuf, Till Requate
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