Mixed oligopoly, foreign penetration and China’s environmental policy: a research based on mixed oligopoly model

Abstract

ABSTRACTThis paper analyzes how the foreign penetration affects China’s environment policy in a mixed oligopoly framework, and gets several interesting conclusions. First, our result shows that government should strengthen the degree of environmental policy along with increasing proportion of domestic ownership of multinational firms. Second, we show that an increase in domestic ownership of multinational firms raises not only domestic private firms’ profit but also public firm’s profit as well as social welfare. Third, the government will raise the environmental tax to control environmental damage.