The regulation of non-point source pollution and risk preferences: An experimental approach

Camacho-Cuena, Eva and Requate, Till (2012) The regulation of non-point source pollution and risk preferences: An experimental approach Ecological Economics, 73 . pp. 179-187.

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Abstract

Many environmental problems, notably arising from agriculture, can be classified as non-point source pollution problems. In this paper we present results of an experimental study on the performance of three mechanisms designed to deal with such problems: collective fining, random fining, and a tax-subsidy scheme. We find that the fining schemes induce under-abatement, a feature being enforced with experience. We further elicit the participants' risk attitude and show that the performance of collective fining is not affected by the subjects' risk preferences. Under a system based on random fining the performance of the mechanism worsens in the presence of risk seeking subjects. However, coordination on over-abatement under the tax-subsidy can be alleviated if subjects are risk averse. (C) 2011 Elsevier B.V. All rights reserved.

Document Type: Article
Research affiliation: Kiel University
OceanRep > The Future Ocean - Cluster of Excellence
Kiel University > Kiel Marine Science
Refereed: Yes
ISSN: 0921-8009
Projects: Future Ocean
Date Deposited: 14 May 2014 10:18
Last Modified: 14 May 2014 10:18
URI: http://eprints.uni-kiel.de/id/eprint/23878

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