The impact of firm-firm externalities on environmental standard

[[abstract]]A model of two industries (sectors) in one economy, in which a sector’s production suffers from the other sector’s pollution emission, is presented to determine the optimal regulatory emission standard and to contrast the gap between the two versions: in the presence and absence of firm-firmdamage effect. The discrepancy of the emission standard setting is surely existent in the presence of firm-firm externalities compared with in the absenceof those. The results reveal that the planned output of polluting industry ishigher in the presence of firm-firm damage effect than in the absence, butthat of nonpolluting industry depends on demand elasticity and damage function.[[notice]]補正完畢[[journaltype]]國外[[booktype]]紙本[[countrycodes]]IN