Environmental and Resource Economics

, Volume 8, Issue 2, pp 183–204 | Cite as

Effectiveness of environmental regulations under imperfect enforcement and the firm's avoidance behavior

  • Chung-Huang Huang
Original Paper
Accepted:

Abstract

This paper explicitly defines enforcement quality and develops a model by incorporating enforcement quality and the firm's avoidance behavior. The results indicate that the effectiveness of environmental regulations is likely to depend upon the level of enforcement quality, as well as upon the nature of the firm's avoidance behavior. Policy instruments may become incompatible under certain circumstances. Enforcement quality should be properly targeted to enhance functional harmonization between instruments. The condition under which emission tax is more effective under imperfect enforcement than under complete enforcement is also identified.

Key words

enforcement quality environmental regulation penalty avoidance behavior 
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Copyright information

© Kluwer Academic Publishers 1996

Authors and Affiliations

  • Chung-Huang Huang
    • 1
    • 2
  1. 1.Department of EconomicsNational Tsing Hua UniversityTaiwan
  2. 2.Institute of EconomicsAcademia SinicaTaiwan

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