Environmental Policy with Endogenous Plant Locations
研究两国政府各自选择环境政策时的博弈，发现非合作均衡通常不是帕累托最优，且可能因吸引产业或规避污染而偏离合作政策。
In a game between the governments of two countries, each chooses its own environmental policy. The Nash equilibria of the game are generally not Pareto optimal. On the one hand, each country may want to attract industry, giving it an incentive to choose low environmental taxes or standards. On the other hand, if disutility from pollution is sufficiently high, each country might prefer that a firm locates only in other countries. This effect tends to make the environmental policy under non‐cooperation stricter than it would be with cooperation.