Special Issues: Environmental Control by Economic Incentives. Studies on Policy Instruments with Economic Incentives.

Economic Incentives for Environmental Regulation

This paper provides a brief summary of the theory and the reality of economic-incentive approaches to environmental regulation. The paper begins with a derivation of the necessary and sufficient condition for a policy instrument to be cost effective, namely that the instrument induces all sources to abate emissions at the same marginal cost. Subsequent sections introduce economic-incentive poli...

Economic Incentives: Options for Environmental Protection

Economic Incentives for Countertrade

This paper examines countertrade using standard economic theory. We show that in many circumstances countertrade is a rational response to transaction costs, information asymmetry, moral hazard-agency problems, and other market imperfections. This paper also integrates countertrade into international business theories. Some preliminary hypotheses, that may be empirically testable after refineme...

Economic incentives transform psychological anomalies

People acting in an anomalous way can do better by reducing their anomalies, and clever people and firms can profit by exploiting anomalies. Due to these reactions, anomalies and their frequency are not exogenously given (as is assumed in the ‘psychological’ and the ‘axiomatic’ approaches) but are endogenous and influenced by social processes. The here proposed ‘incentive’ approach focuses on t...

Economic Incentives in Software Design

I examine the incentives for software providers to design appropriate user interfaces. There are two sorts of costs involved when one uses software: the fixed cost of learning to use a piece of software and the variable cost of operating the software. I show that a monopoly provider of software generally invests the right amount of resources in making the software easy to learn, but too little ...