Abstract
AbstractWe investigate the optimal privatization policy in a polluting mixed duopoly when environmental taxes are used. Firms adopt clean technology to reduce emissions. We consider the situation of exogenous tax and find that (i) partial privatization is always optimal under low marginal damage, while full nationalization may be optimal under high marginal damage; (ii) the optimal privatization level always increases with tax rate under low marginal damage, while it may decrease with tax rate under high marginal damage. As an extension, we consider the endogenous tax situation and show that full nationalization may be optimal under sufficiently high marginal damage.
Sign-in/Register to access full text options 
Free) 
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
