Population Mobility and Transboundary Environmental Problems

14 Pages Posted: 21 Jul 2001

See all articles by Michael Hoel

Michael Hoel

University of Oslo; CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

Perry Shapiro

University of California, Santa Barbara (UCSB) - Department of Economics; University of Melbourne - Department of Economics

Date Written: May 2001

Abstract

A standard result in the literature on environmental economics is that efficient environmental policies regulating transboundary pollution will be adopted only if there is interjurisdictional coordination. Efficient policies can be adopted as a result of interregional treaties or mandated by a central authority. The present paper demonstrates that if there is perfect population mobility between the regions affected by the transboundary pollution, the efficient outcome is a Nash equilibrium of the policy game between regional authorities. This is true independently of what policies are available to the regional authorities. However, there may be more than one Nash equilibrium, so that policy coordination may be necessary in order to achieve the best equilibrium.

Keywords: Transboundary Pollution, Population Mobility, Federalism

JEL Classification: D6, H7, Q20, R23

Suggested Citation

Hoel, Michael and Shapiro, Perry, Population Mobility and Transboundary Environmental Problems (May 2001). Available at SSRN: https://ssrn.com/abstract=274303 or http://dx.doi.org/10.2139/ssrn.274303

Michael Hoel (Contact Author)

University of Oslo ( email )

P.O. Box 1095 Blindern
N-0317 Oslo
Norway
+ 47 22 85 83 87 (Phone)
+ 47 22 85 50 35 (Fax)

CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

Poschinger Str. 5
Munich, DE-81679
Germany

HOME PAGE: http://www.CESifo.de

Perry Shapiro

University of California, Santa Barbara (UCSB) - Department of Economics ( email )

2127 North Hall
Santa Barbara, CA 93106
United States

University of Melbourne - Department of Economics ( email )

Victoria 3010, 3010
Australia

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