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The Problem Of Maintaining Compliance Within Stable Coalitions: Experimental Evidence, David M. Mcevoy, James J. Murphy, John M. Spraggon, John K. Stranlund
The Problem Of Maintaining Compliance Within Stable Coalitions: Experimental Evidence, David M. Mcevoy, James J. Murphy, John M. Spraggon, John K. Stranlund
John K. Stranlund
This study examines the performance of stable cooperative coalitions that form to provide a public good when coalition members have the opportunity to not comply with their commitments. A stable coalition is one in which no member wishes to leave and no non-member wishes to join. To counteract the incentive to violate their commitments, coalition members fund a third-party enforcer. This leads to the theoretical conclusion that stable coalitions are larger (and provide more of a public good) when their members must finance enforcement relative to when compliance is ensured without the need for costly enforcement. However, our experiments reveal …
A Note On Emissions Taxes And Incomplete Information, Carlos A. Chavez, John K. Stranlund
A Note On Emissions Taxes And Incomplete Information, Carlos A. Chavez, John K. Stranlund
John K. Stranlund
In contrast with what we perceive is the conventional wisdom about setting emissions taxes under uncertainty, we demonstrate that setting a uniform tax equal to expected marginal damage is not generally efficient under incomplete information about firms’ abatement costs and damages from pollution. We show that efficient taxes will deviate from expected marginal damage if there is uncertainty about the slopes of the marginal abatement costs of regulated firms. Moreover, efficient emissions tax rates will vary across firms if a regulator can use observable firm-level characteristics to gain some information about how the firms’ marginal abatement costs vary.
Does Government Regulation Complement Existing Community Efforts To Support Cooperation? Evidence From Field Experiments In Colombia, Maria Claudia Lopez, James J. Murphy, John M. Spraggon, John K. Stranlund
Does Government Regulation Complement Existing Community Efforts To Support Cooperation? Evidence From Field Experiments In Colombia, Maria Claudia Lopez, James J. Murphy, John M. Spraggon, John K. Stranlund
John K. Stranlund
In this paper we describe a field experiment conducted among mollusk harvesters in a community on the Pacific Coast of Colombia. The experiment is based on a standard linear public good and consists of two stages. In the first stage we compare the ability of monetary and nonmonetary sanctions among community members to increase contributions to the public good. In the second stage we add a government regulation with either a high or low sanction for noncompliance to community enforcement efforts. The results for the first stage are consistent with other comparisons of monetary and nonmonetary sanctions within groups; both …
Bankruptcy Risk And Imperfectly Enforced Emissions Taxes, John K. Stranlund, Wei Zhang
Bankruptcy Risk And Imperfectly Enforced Emissions Taxes, John K. Stranlund, Wei Zhang
John K. Stranlund
Under favorable but reasonable conditions, an imperfectly enforced emissions tax produces the efficient allocation of individual emissions control; aggregate emissions are independent of whether enforcement of the tax is sufficient to induce the full compliance of firms, and differences in individual violations are independent of firm-level differences. All of these desirable characteristics disappear when some firms under an emissions tax risk bankruptcy—the allocation of emissions control is inefficient, imperfect enforcement causes higher aggregate emissions, and financially insecure firms choose higher violations.
Imperfect Enforcement Of Emissions Trading And Industry Welfare: A Laboratory Investigation, John K. Stranlund, James J. Murphy, John M. Spraggon
Imperfect Enforcement Of Emissions Trading And Industry Welfare: A Laboratory Investigation, John K. Stranlund, James J. Murphy, John M. Spraggon
John K. Stranlund
This paper uses laboratory experiments to investigate the performance of emission permit markets when compliance is imperfectly enforced. In particular we examine deviations in observed aggregate payoffs and expected penalties from those derived from a model of risk-neutral payoff-maximizing firms. We find that the experimental emissions markets were reasonably efficient at allocating individual emission control choices despite imperfect enforcement and significant noncompliance. However, violations and expected penalties were lower than predicted when these are predicted to be high, but were about the same as predicted values when these values were predicted to be low. Thus, although a standard model of …