The Environmental Effect of Ambient Charges in Mixed Triopoly with Diverse Firm Objectives
The theoretical analysis by Ganguli and Raju (2012) considers two Bertrand duopoly games to reassess the effect of an increase in ambient charges as a policy measure for reducing industrial non-point source pollution. In the first game, the regulator first announces the ambient charge and then two firms non-cooperatively and simultaneously choose their prices. In this game, the pollution abatement technologies are assumed to be fixed. In the second game, knowing that the ambient charge has been announced by the regulator, two firms non-cooperatively and simultaneously choose their pollution abatement technologies in the first stage and prices in the second stage. Ganguli and Raju demonstrate that in each game an increase in the ambient charge leads to more pollution. In addition, Sato (2017) examines the effect of an increase in ambient charges in a static Cournot duopoly model and shows that an increase in the ambient charge leads to less pollution as opposed to Bertrand duopoly competition.
In this paper, we examine a quantity-setting mixed triopoly model comprising a profit-maximizing firm, a partially cooperating firm and a socially concerned firm to reassess the environmental effect of an increase in ambient charges.
Ohnishi, K. 2021. The Environmental Effect of Ambient Charges in Mixed Triopoly with Diverse Firm Objectives, Journal of Applied Economic Sciences, Volume XVI, Fall, 3(73): 247– 250. https://doi.org/10.57017/jaes.v16.3(73).01
Article’s history:
Received 10th of September, 2021; Received in revised form 28th of September, 2021; Accepted 4th of October, 2021; Published 15th of October, 2021. All rights reserved to the Publishing House.
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