IDEAS home Printed from https://ideas.repec.org/a/taf/applec/v42y2010i1p97-105.html
   My bibliography  Save this article

Social norms and emission tax multiple equilibria in adopting pollution abatement device

Author

Listed:
  • Ho Shirley

Abstract

The effect of social norm is addressed in an adoption game, where an emission tax is used to motivate oligopolistic firms to adopt a pollution abatement device. We ask if the intrinsic motivation from social norm alone can motivate firms to participate in adoption. The multiple equilibria in the adoption game indicates two possibilities: this intrinsic motivation may or may not enhance adoption. The existing literature on equilibrium selection further suggests that the most likely outcome is that it cannot enhance adoption. Next, by keeping the assumption of symmetry, we show that if cooperation is an option for firms, then the presence of two coordination effects (social norm on adoption and cooperation benefits on output) will result in the existence of asymmetric adoptions.

Suggested Citation

  • Ho Shirley, 2010. "Social norms and emission tax multiple equilibria in adopting pollution abatement device," Applied Economics, Taylor & Francis Journals, vol. 42(1), pages 97-105.
  • Handle: RePEc:taf:applec:v:42:y:2010:i:1:p:97-105
    DOI: 10.1080/00036840701537844
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1080/00036840701537844
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: https://libkey.io/10.1080/00036840701537844?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. John C. Harsanyi & Reinhard Selten, 1988. "A General Theory of Equilibrium Selection in Games," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262582384, April.
    2. Rauscher, Michael, 1997. "Voluntary Emission Reductions, Social Rewards, and Environmental Policy," Thuenen-Series of Applied Economic Theory 10, University of Rostock, Institute of Economics.
    3. Kennedy, Peter W. & Laplante, Benoit, 1995. "Equilibrium incentives for adopting cleaner technology under emissions pricing," Policy Research Working Paper Series 1491, The World Bank.
    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. Herzing, Mathias, 2021. "Multiple equilibria in the context of inspection probabilities depending on firms’ relative emissions," Resource and Energy Economics, Elsevier, vol. 63(C).

    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. van Damme, Eric & Hurkens, Sjaak, 1999. "Endogenous Stackelberg Leadership," Games and Economic Behavior, Elsevier, vol. 28(1), pages 105-129, July.
    2. Dennis L. Gärtner, 2022. "Corporate Leniency in a Dynamic World: The Preemptive Push of an Uncertain Future," Journal of Industrial Economics, Wiley Blackwell, vol. 70(1), pages 119-146, March.
    3. Paul Pezanis-Christou & Abdolkarim Sadrieh, 2003. "Elicited bid functions in (a)symmetric first-price auctions," Working Papers 85, Barcelona School of Economics.
    4. Maarten C.W. Janssen, 1997. "Focal Points," Tinbergen Institute Discussion Papers 97-091/1, Tinbergen Institute.
    5. Michael Kosfeld, 2002. "Stochastic strategy adjustment in coordination games," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 20(2), pages 321-339.
    6. Andrea Isoni & Robert Sugden & Jiwei Zheng, 2018. "The Pizza Night Game: Efficiency, Conflict and Inequality in Tacit Bargaining Games with Focal Points," Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) 18-01, School of Economics, University of East Anglia, Norwich, UK..
    7. Smith, Lisa C. & Chavas, Jean-Paul, 1999. "Supply response of West African agricultural households," FCND discussion papers 69, International Food Policy Research Institute (IFPRI).
    8. Pal, Rupayan, 2010. "Technology adoption in a differentiated duopoly: Cournot versus Bertrand," Research in Economics, Elsevier, vol. 64(2), pages 128-136, June.
    9. Zhang, Boyu & Hofbauer, Josef, 2016. "Quantal response methods for equilibrium selection in 2×2 coordination games," Games and Economic Behavior, Elsevier, vol. 97(C), pages 19-31.
    10. Dieter Balkenborg & Rosemarie Nagel, 2016. "An Experiment on Forward vs. Backward Induction: How Fairness and Level k Reasoning Matter," German Economic Review, Verein für Socialpolitik, vol. 17(3), pages 378-408, August.
    11. Andonie, Costel & Kuzmics, Christoph, 2012. "Pre-election polls as strategic coordination devices," Journal of Economic Behavior & Organization, Elsevier, vol. 84(2), pages 681-700.
    12. van Damme, Eric & Hurkens, Sjaak, 2004. "Endogenous price leadership," Games and Economic Behavior, Elsevier, vol. 47(2), pages 404-420, May.
    13. Jun Honda, 2015. "Games with the Total Bandwagon Property," Department of Economics Working Papers wuwp197, Vienna University of Economics and Business, Department of Economics.
    14. Kempf, Hubert & Rota-Graziosi, Grégoire, 2010. "Endogenizing leadership in tax competition," Journal of Public Economics, Elsevier, vol. 94(9-10), pages 768-776, October.
    15. , & , & ,, 2008. "Monotone methods for equilibrium selection under perfect foresight dynamics," Theoretical Economics, Econometric Society, vol. 3(2), June.
    16. Konstantinos Georgalos & Indrajit Ray & Sonali SenGupta, 2020. "Nash versus coarse correlation," Experimental Economics, Springer;Economic Science Association, vol. 23(4), pages 1178-1204, December.
    17. Giovanna Devetag, 2000. "Transfer, Focality and Coordination: Some Experimental Results," LEM Papers Series 2000/02, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    18. Antonio Cabrales & Michalis Drouvelis & Zeynep Gurguy & Indrajit Ray, 2017. "Transparency is Overrated: Communicating in a Coordination Game with Private Information," CESifo Working Paper Series 6781, CESifo.
    19. Yoo, Seung Han, 2014. "Learning a population distribution," Journal of Economic Dynamics and Control, Elsevier, vol. 48(C), pages 188-201.
    20. van Damme, E.E.C., 1995. "Game theory : The next stage," Other publications TiSEM 7779b0f9-bef5-45c7-ae6b-7, Tilburg University, School of Economics and Management.

    More about this item

    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:taf:applec:v:42:y:2010:i:1:p:97-105. 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: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/RAEC20 .

    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.