Voluntary Compliance with Market‐Based Environmental Policy
Evidence from the U. S. Acid Rain Program
Bibliographic Data
| ID | 10182162 |
|---|---|
| Authors | Juan‐Pablo Montero (0000-0002-6815-0158, Pontificia Universidad Católica de Chile, corresponding author) |
| Year | 1999 |
| Volume | 107 |
| Issue | 5 |
| Pages | 998-1033 |
| Publication date | 1999-10-01 |
| Open Access | No |
| Type | ARTICLE |
| Venue | Journal of Political Economy (JOURNAL) |
| Journal identifiers | ISSN: 0022-3808 • E-ISSN: 1537-534X |
| Publisher | University of Chicago Press (PUBLISHER • US) |
| DOI | 10.1086/250088 |
| OpenAlex | W1994128970 |
| Language | EN |
| Citations received | 10 |
| References cited | 6 |
The U. S. Acid Rain Program implemented a nationwide market for electric utilities' sulfur dioxide (SO2) emissions and included voluntary compliance possibilities for nonaffected sources. I observe significant voluntary participation‐albeit with small impact on the SO2 market‐mostly from sources with counterfactual emissions below their allowance allocations. An ex post analysis suggests that costs from the resulting higher emissions outweigh savings from shifts in emissions reductions from high‐cost affected sources to low‐cost nonaffected sources. Further, utilities' voluntary participation is well explained by economic variables, which provides new evidence of cost‐effective compliance strategies and low transaction costs
Acid rain · Allowance (engineering · Business · Compliance (psychology · Counterfactual thinking · Economics · Natural resource economics · Operations management · Public economics · Transaction cost · Turnover · Climate Change Policy and Economics · Economic and Environmental Valuation · Finance · Regulation and Compliance Studies
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| Citations per year | 0.43 |
|---|---|
| Citation span | 2003 - 2025 (23) |
| Highly cited | No |