Environmental Protection and the Private Provision of International Public Goods

10 Pages Posted: 27 Sep 2010

See all articles by Martin Altemeyer-Bartscher

Martin Altemeyer-Bartscher

Chemnitz University of Technology (CUT)

Dirk T. G. Rübbelke

Technische Universität Bergakademie Freiberg

Eytan Sheshinski

Hebrew University of Jerusalem; National Bureau of Economic Research (NBER); CESifo (Center for Economic Studies and Ifo Institute)

Abstract

International environmental protection like the combat of global warming exhibits properties of public goods. In the international arena, no coercive authority exists that can enforce measures to overcome free-rider incentives. Therefore decentralized negotiations between individual regions serve as an approach to pursue efficient international environmental protection. We propose a scheme which is based on the ideas of Coasean negotiations and Pigouvian taxes. The negotiating entities offer side-payments to counterparts in order to influence their taxation of polluting consumption. Side-payments, in turn, are self-financed by means of externality-correcting taxes. As we show, a Pareto-efficient outcome can be attained.

Suggested Citation

Altemeyer-Bartscher, Martin and Rübbelke, Dirk T. G. and Sheshinski, Eytan, Environmental Protection and the Private Provision of International Public Goods. Economica, Vol. 77, Issue 308, pp. 775-784, October 2010, Available at SSRN: https://ssrn.com/abstract=1681690 or http://dx.doi.org/10.1111/j.1468-0335.2009.00796.x

Martin Altemeyer-Bartscher (Contact Author)

Chemnitz University of Technology (CUT) ( email )

Chemnitz
Germany

Dirk T. G. Rübbelke

Technische Universität Bergakademie Freiberg ( email )

Freiberg, 09599
Germany

Eytan Sheshinski

Hebrew University of Jerusalem ( email )

Department of Economics
Jerusalem 91905
Israel
972-2-588-3144 (Phone)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

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