Abstract
This study investigates the effectiveness of ambient charges under non-point source (NPS) pollutions in an imperfect competition framework. To this end, following Ganguli and Raju, it constructs a one-stage game and a two-stage game in which Bertrand duopolistic firms choose their best prices and abatement technology, respectively. It is demonstrated in both games that an increase in the ambient charge can lead to a decrease in pollution. This finding indicates that the ambient charge can efficiently control pollution in a Bertrand duopoly.
Highlights
It is well-known that most of today’s pollutions such as air pollution, river pollution and lake pollution have multiple sources any pollution originates from a single point source
This study investigates the effectiveness of ambient charges under non-point source (NPS) pollutions in an imperfect competition framework
Ganguli and Raju [1] consider the same subject in a Bertrand duopolistic market and numerically exhibit a “perverse” effect that an increase of ambient charge may lead to an increase in pollution in two distinct settings, one in the one-stage game and the other in the two-stage game
Summary
It is well-known that most of today’s pollutions such as air pollution, river pollution and lake pollution have multiple sources any pollution originates from a single point source It is, not known how to control these NPS (non-point source) pollutions. Ganguli and Raju [1] consider the same subject in a Bertrand duopolistic market and numerically exhibit a “perverse” effect that an increase of ambient charge may lead to an increase in pollution in two distinct settings, one in the one-stage game and the other in the two-stage game. This study shows the good-natured effect of ambient charges in Bertrand duopoly, analytically in one-stage game and numerically in two-stage game.
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
