IDEAS home Printed from https://ideas.repec.org/a/prg/jnlpol/v2023y2023i1id1368p89-103.html
   My bibliography  Save this article

Induced vs. Voluntary Green Production: Which Is Better for Society?

Author

Listed:
  • Domenico Buccella
  • Augustine Abakpa

Abstract

This article studies the environmental and societal impacts of a polluting monopoly when a society strives for a clean environment. Two scenarios are considered: (1) the government levies an environmental tax to induce investment in emission-reducing technology, and (2) the monopolist engages in environmental corporate social responsibility (CSR). It is shown that taxation has a lower environmental impact, but the monopolist undertakes CSR activities only if the abatement technology is efficient. Social welfare is always higher under CSR; therefore, when the technology is not adequately efficient, the government should implement a second-best environmental tax policy to avoid the worst welfare outcome.

Suggested Citation

  • Domenico Buccella & Augustine Abakpa, 2023. "Induced vs. Voluntary Green Production: Which Is Better for Society?," Politická ekonomie, Prague University of Economics and Business, vol. 2023(1), pages 89-103.
    • Handle: RePEc:prg:jnlpol:v:2023:y:2023:i:1:id:1368:p:89-103
    DOI: 10.18267/j.polek.1368
    as

    Download full text from publisher

    File URL: http://polek.vse.cz/doi/10.18267/j.polek.1368.html
    Download Restriction: free of charge
    File URL: http://polek.vse.cz/doi/10.18267/j.polek.1368.pdf
    Download Restriction: free of charge
    File URL: https://libkey.io/10.18267/j.polek.1368?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Ministry of Finance, Government of India,, 2016. "Economic Survey 2015-16," OUP Catalogue, Oxford University Press, number 9780199469284.
    2. Ulph, Alistair, 1996. "Environmental Policy and International Trade when Governments and Producers Act Strategically," Journal of Environmental Economics and Management, Elsevier, vol. 30(3), pages 265-281, May.
    3. Elias Asproudis & Maria Gil-Moltó, 2015. "Green Trade Unions: Structure, Wages and Environmental Technology," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 60(2), pages 165-189, February.
    4. Fukuda, Katsufumi & Ouchida, Yasunori, 2020. "Corporate social responsibility (CSR) and the environment: Does CSR increase emissions?," Energy Economics, Elsevier, vol. 92(C).
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Doori Kim & Sang‐Ho Lee, 2024. "Environmental policies with the excess burden of public funds and privatisation," Australian Economic Papers, Wiley Blackwell, vol. 63(2), pages 329-349, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Buccella, Domenico & Fanti, Luciano & Gori, Luca, 2024. "Corporate Social Responsibility: A theory of the firm revisited with environmental issues," GLO Discussion Paper Series 1421, Global Labor Organization (GLO).
    2. Buccella, Domenico & Fanti, Luciano & Gori, Luca, 2021. "To abate, or not to abate? A strategic approach on green production in Cournot and Bertrand duopolies," Energy Economics, Elsevier, vol. 96(C).
    3. Bárcena-Ruiz, Juan Carlos & Garzón, María Begoña & Sagasta, Amagoia, 2023. "Environmental corporate social responsibility, R&D and disclosure of “green” innovation knowledge," Energy Economics, Elsevier, vol. 120(C).
    4. Domenico Buccella & Luciano Fanti & Luca Gori, 2023. "Managerial firms’ profitability, unions, and environmental taxes," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 94(2), pages 575-598, June.
    5. Domenico Buccella & Luciano Fanti & Luca Gori & Mauro Sodini, 2024. "Green subsidies as strategic trade policy tools," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 26(4), pages 741-757, October.
    6. Bárcena-Ruiz, Juan Carlos & Sagasta, Amagoia, 2022. "International trade and environmental corporate social responsibility," Energy Economics, Elsevier, vol. 115(C).
    7. Buccella, Domenico & Fanti, Luciano & Gori, Luca, 2022. "‘Green’ managerial delegation theory," Environment and Development Economics, Cambridge University Press, vol. 27(3), pages 223-249, June.
    8. Ana Maria Santacreu & Michael Sposi & Jing Zhang, 2021. "What Determines State Heterogeneity in Response to US Tariff Changes?," Working Papers 2021-007, Federal Reserve Bank of St. Louis, revised 08 Mar 2023.
    9. Petrakis, Emmanuel & Xepapadeas, Anastasios, 2003. "Location decisions of a polluting firm and the time consistency of environmental policy," Resource and Energy Economics, Elsevier, vol. 25(2), pages 197-214, May.
    10. Sturm, Daniel & Ulph, Alistair, 2002. "Environment, trade, political economy and imperfect information: a survey," Discussion Paper Series In Economics And Econometrics 0204, Economics Division, School of Social Sciences, University of Southampton.
    11. Claudia Ranocchia & Luca Lambertini, 2021. "Porter Hypothesis vs Pollution Haven Hypothesis: Can There Be Environmental Policies Getting Two Eggs in One Basket?," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 78(1), pages 177-199, January.
    12. Adel Ben Youssef & Ludovic Ragni, 1998. "Politiques environnementales stratégiques et concurrence internationale : théorie et évidences," Revue d'Économie Industrielle, Programme National Persée, vol. 83(1), pages 81-98.
    13. Al Khourdajie, Alaa & Finus, Michael, 2020. "Measures to enhance the effectiveness of international climate agreements: The case of border carbon adjustments," European Economic Review, Elsevier, vol. 124(C).
    14. Joanna Poyago-Thotoky, 2003. "Optimal Environmental Taxation, R&D Subsidization and the Role of Market Conduct," Finnish Economic Papers, Finnish Economic Association, vol. 16(1), pages 15-26, Spring.
    15. Juan Carlos Bárcena-Ruiz, 2006. "Environmental Taxes and First-Mover Advantages," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 35(1), pages 19-39, September.
    16. Soham Baksi, 2014. "Regional versus Multilateral Trade Liberalization, Environmental Taxation, and Welfare," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 47(1), pages 232-249, February.
    17. Stefano Clo' & Gianluca Iannucci & Alessandro Tampieri, 2024. "Emission permits and firms' environmental responsibility," Working Papers - Economics wp2024_06.rdf, Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa.
    18. Ioanna Pantelaiou & Panos Hatzipanayotou & Panagiotis Konstantinou & Anastasios Xepapadeas, 2020. "Can Cleaner Environment Promote International Trade? Environmental Policies as Export Promoting Mechanisms," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 75(4), pages 809-833, April.
    19. Fabio Antoniou & Efthymia Kyriakopoulou, 2019. "On the Strategic Effect of International Permits Trading on Local Pollution," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 74(3), pages 1299-1329, November.

    More about this item

    Keywords

    Green production; abatement; environmental tax; environmental corporate social responsibility;
    All these keywords.

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • M5 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:prg:jnlpol:v:2023:y:2023:i:1:id:1368:p:89-103. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Stanislav Vojir (email available below). General contact details of provider: https://edirc.repec.org/data/uevsecz.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.