Emission Standards and Emission Taxes for Production and Consumption
1 : NGU | Nuertingen-Geislingen University
2 : University of Göttingen
This paper studies the effect of environmental standards for production and the consumption and environmental taxes in production and consumption on prices, quantities, and welfare in a duopolistic market. Governments can apply emission standards and emission taxes for production and/or for consumption of products. While the use of an emission standard or an emission tax during production affects the competitiveness of firms, a consumption standard or consumption tax is said to be neutral with respect to competition.