Abstract
We present an explicit model of firm-regulator negotiations in a market with several firms. We describe how the regulatory surplus is distributed between firms and regulator, and analyse the impact of various parameters on the resulting level of environmental regulation. Our main result is that a 'toughest firm principle' holds: the outcome of negotiations is essentially determined by the firm with the most aggressive attitude towards environmental control.
Original language | English |
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Pages (from-to) | 2725-2736 |
Number of pages | 12 |
Journal | Journal of Public Economics |
Volume | 87 |
Issue number | 12 |
DOIs | |
Publication status | Published - Dec 2003 |
Bibliographical note
Copyright:Copyright 2004 Elsevier B.V., All rights reserved.
Keywords
- Multiperson bargaining
- Regulation
- Voluntary agreements