DEMANDA INELÁSTICA POR CERTIFICADOS NEGOCIÁVEIS DE POLUIÇÃO E O PROBLEMA DA ALOCAÇÃO INICIAL

Abstract

The analysis of environmental problems and the proposal of policies for its solution have been more and more benefitted by the Microeconomic Theory. The market–based politicy instruments have been highly used, particularly the tradable pollution permits. They are a strong tool of environmental policy, particularly due to its properties of cost effectiveness. The success of the programs shows acid rain control in the USA and Canada as a reference. However, several works aim the inherent problems of this mechanism, mainly the issue of the initial alocation, that can have as a consequence the existence of market imperfection. This work shows that if the demand function for permits is inelastic (or presents segments of inelasticities), there is a possibility that, under certain alocation, a firm acts with some market power. The solution would be the establishment of an approach adapted for alocation, based on information on the structure of production of the firms, but this would induce to the possibility of strategic behavior.