Abstract:In this paper, we shed light on the nature of the interaction between an environmental authority (EA) and the polluting sector in a developing country (DC) when there is uncertainty about the relative weight that this EA places on public versus its own welfare. Within the context of this general issue, we answer three specific questions for any arbitrary time period First, we determine the expected level of pollution as well as the actual pollution in the polluting sector. Second, we compute the mean social lo… Show more
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