RT Journal Article
T1 The Design of Emission Taxes in Markets with New Firm Acquisitions
A1 Gautier, Luis
A1 Fikru, Mahelet G.
K1 Impuestos ambientales
K1 Contaminación - Control
AB In the 1990s there was a great deal of interest in the study of the role of endogenous marketstructure under oligopoly in the characterization of emission taxes. This interest wasinstrumental in providing policy guidance on the design of emission taxes based on marketcharacteristics. However, the literature has been silent on offering policy recommendationson the design of emission taxes under endogenous market structure in the presence ofnew firm acquisitions. We build a model where new firms enter the market where someare acquired by an incumbent multi-plant firm, altering the initial market structure. Inthis framework, we characterize the second-best emission tax and examine the role ofthe resulting market structure, in particular the role of acquiring more/fewer of the newfirms, in the optimal design of emission tax. We argue that, under certain conditions, theacquisition of new firms may lead to higher taxation consistent with the Pigouvian ruleor even exceed marginal damages. Our contribution is at the intersection of emission taxdesign and M &A (new firm acquisition) literature.
PB Springer
YR 2024
FD 2024-04-15
LK https://hdl.handle.net/10630/31036
UL https://hdl.handle.net/10630/31036
LA eng
NO Gautier, L., Fikru, M.G. The Design of Emission Taxes in Markets with New Firm Acquisitions. Environ Resource Econ (2024). https://doi.org/10.1007/s10640-024-00845-2
NO Funding for open access charge: Universidad de Málaga / CBUA
DS RIUMA. Repositorio Institucional de la Universidad de Málaga
RD 20 ene 2026