Study on Environmental Policy for Non-Point Source Pollutions in a Bertrand Duopoly

Authors

  • Akio Matsumoto Department of Economics, International Center for further Development of Dynamic Economic Research, Chuo University, Tokyo, Japan.
  • Keiko Nakayama Department of Economics, Chukyo University, Nagoya, Japan.
  • Ferenc Szidarovszky Department of Mathematics, Corvinus University, Budapest, Hungary.

DOI:

https://doi.org/10.9734/bpi/ieam/v6/6428D

Keywords:

Non-point source pollution, abatement technology, ambient charge, Bertrand competition, two-stage game

Abstract

This study investigates the effectiveness of ambient charges under non-point source (NPS) pollutions in an imperfect competition framework. To this end, following Ganguli and Raju [1], it constructs a one-stage game and a two-stage game in which Bertrand duopolistic firms choose their best prices and abatement technology, respectively. It is demonstrated in both games that an increase in the ambient charge can lead to a decrease in pollution. This finding indicates that the ambient charge might be an efficient method to control NPS pollutions even in a duopoly Bertrand market.

Published

2021-02-20

How to Cite

Akio Matsumoto, Keiko Nakayama, & Ferenc Szidarovszky. (2021). Study on Environmental Policy for Non-Point Source Pollutions in a Bertrand Duopoly. Insights into Economics and Management Vol. 6, 1–14. https://doi.org/10.9734/bpi/ieam/v6/6428D

Issue

Insights into Economics and Management Vol. 6

Section

Chapters