Environmental Policy and the Size Distribution of Firms

Reference : Environmental Policy and the Size Distribution of Firms


	Document type :	E-prints/Working papers : Already available on another site
	Discipline(s) :	Business & economic sciences : Microeconomics
	To cite this reference:	http://hdl.handle.net/10993/32644

Title :	Environmental Policy and the Size Distribution of Firms
Language :	English
Author, co-author :	Coria, Jessica []
	Kyriakopoulou, Efthymia [University of Luxembourg > Faculty of Law, Economics and Finance (FDEF) > Center for Research in Economic Analysis (CREA) >]
Publication date :	2015
Peer reviewed :	No
Keywords :	[en] environmental regulations ; energy efficiency ; size distribution
Abstract :	[en] In this paper we analyze the e¤ects of environmental policies on the size distribution of firms. We model a stationary industry where the observed size distribution is a solution to the profit maximization problem of heterogeneous firms that di¤er in terms of their energy e¢ ciency. We compare the equilibrium size distribution under emission taxes, uniform emission standards, and performance standards. Our results indicate that, unlike emission taxes and performance standards, emission standards introduce regulatory asymmetries favoring small firms. These asymmetries cause significant detrimental e¤ects on total output and total welfare, yet lead to reduced emissions and might help preserve small businesses.
Permalink :	http://hdl.handle.net/10993/32644
source URL :	https://ideas.repec.org/p/hhs/gunwpe/0614.html

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