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This paper analyzes Pareto-optimal environmental taxation with self-selection constraints. This study explores different channels that can affect optimal environmental taxation under the assumption that the government cannot observe individuals' productivity types. My findings suggest that there are two distinctive distortions (self-selection distortion \& money transfer distortion) that induce ... read morepollution tax above and below marginal social damage of pollution. Simulations under different parameters provide reasonable interpretation of the impact of information asymmetry on dirty tax.
Thesis (M.S.)--Tufts University, 2019.
Submitted to the Dept. of Economics.
Advisor: Gilbert Metcalf.
Committee: Ujjayant Chakravorty.
Keyword: Economics.read less
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