| dc.description.abstract | The production activities of many industries usually have pollution and cause environmental externality. The government usually use the environmental policy to solve this problem, so that firms may have incentive to reduce production or use abatement technology to reduce environmental damage. Generally, different firms will have different technology. Therefore, when a firm do pollution abatement technology , there is also a possibility that there will be different pollution abatement technology among firms, so that the abatement license occurs among firms with different technology. In addition, pollution tax is the simplest and most effective way to solve externality problem. However, the setting of traditional pollution tax does not consider whether the tax amount will affect the abatement license. Therefore, this study discusses government’s optimal policy and firms abatement license when they tax by government.
For that, we set the multi-stage game to study this thesis. In this game, we assume two firms produce homogeneous products with pollution, their marginal environmental damage is different, and they don’t have any production cost . In addition, considering that the government′s policy will not change frequently, we will use the fixed fee to analysis pollution taxes on the abatement license between firms in the long-term and short-term. We can find that when the pollution tax is exogenous variable, abatement license may get the better social welfare, but the abatement license is not happen between the firms, which causes market failure. If the pollution tax is endogenous variable, the government will set a lower pollution tax to allow the abatement license occur when the disadvantaged firm of pollution abatement technology gap is small. And the government will set a higher pollution tax to allow the abatement license occur when abatement technology gap is big. Therefore, if we can consider both the environmental damage caused by production and the abatement license between firms, the problem of market failure can be avoided. | en_US |