Author(s)

Akio Matsumoto¹, Keiko Nakayama², Ferenc Szidarovszky³

¹Department of Economics, Senior Researcher, International Center for further Development of Dynamic Economic Research, Chuo University, Tokyo, Japan.
²Department of Economics, Chukyo University, Nagoya, Japan.
³Department of Applied Mathematics, University of Pécs, Pécs, Hungary.

This study investigates the effectiveness of ambient charges under non-point source (NPS) pollutions in an imperfect competition framework. To this end, following Ganguli and Raju, it constructs a one-stage game and a two-stage game in which Bertrand duopolistic firms choose their best prices and abatement technology, respectively. It is demonstrated in both games that an increase in the ambient charge can lead to a decrease in pollution. This finding indicates that the ambient charge can efficiently control pollution in a Bertrand duopoly.

Non-Point Source Pollution, Abatement Technology, Ambient Charge, Bertrand Competition, Two-Stage Game

Matsumoto, A. , Nakayama, K. and Szidarovszky, F. (2018) Environmental Policy for Non-Point Source Pollutions in a Bertrand Duopoly. Theoretical Economics Letters, 8, 1058-1069. doi: 10.4236/tel.2018.85073.