Athanasios Kampas

Selecting permit allocation rules for agricultural pollution control: a bargaining solution

Abstract One of the primary justifications for using transferable permits for pollution control is that they achieve a given level of emission reduction at the lowest cost. Although the initial allocation of pollution permits may have no impact in terms of efficiency, it does have a significant impact on equity. In this paper, we examine a variety of permit allocation rules for a small catchment in South West England. An asymmetric Nash bargaining framework is employed to characterise agents’ co-operative behaviour and to explain their likely preferences over permit allocation rules. The results indicate that the preferred allocation scheme depends upon the relative bargaining power of the agents. Furthermore, some potential links between ex-ante and ex-post equity criteria were also discussed.

On the Scarcity Value of Irrigation Water: Juxtaposing Two Market Estimating Approaches

The aim of this paper is to compare the supply-side and demand-side approaches for assessing the scarcity rents of irrigation water. The results obtained from the case study confirm the expectation that the demand-side rationale provides the lower bound estimate of water scarcity rents. Specifically, a hypothetical elimination of water scarcity brings extra benefits to the local farmers, but these benefits cannot compensate the costs of the backstop technology which provide such extra water. Therefore, the lost opportunities, in terms of income forgone due to water scarcity, cannot legitimize supply-side approaches alone. A “soft” sensitivity analysis was included to examine the robustness of such a cost-effective property, while the policy implications of the results are also examined.

On the regulatory choice of refunding rules to reconcile the 'polluter pays principle' and Pigovian taxation: an application

The ‘polluter pays principle’ (PPP) is one of the four principles that govern the European Unions environmental policy. Although PPP justifies Pigovian taxation as a legitimate policy means to internalise externalities, there is a potential contradiction between PPP and Pigovian taxation depending upon the definition of pollution control costs. We summarise this debate and focus on the lump-sum refunding of tax revenues in order to reconcile the PPP and Pigovian taxation. We propose equity as the guiding principle to select among various refunding schemes, and empirically examine a specific application.

Some evidence of the relative efficiency of multiple-instrument policies for controlling agricultural nonpoint pollution: an application to nitrate pollution

Controlling water pollution from agriculture is intrinsically difficult. In most cases, pollution occurs over a wide area and its sources are diffuse and difficult to identify. In addition, water pollution levels can vary substantially over space and time, and depend not only on rainfall pattern and land type, but also on farmers’ decisions. These decisions include land use choices, crop choices, production techniques and the intensity of inputs used. Under the conventional assumption of farmers’ rationality,1 such decisions are determined by relative prices as well as by government support policies.