Enforcement missions: targets vs budgets

Heyes, Anthony and Kapur, Sandeep (2009) Enforcement missions: targets vs budgets. Journal of Environmental Economics and Management, 58 (2). pp. 129-140. ISSN 00950696

Full text not available from this repository.

Abstract

Enforcement of policy is typically delegated. What sort of mission should the head of an enforcement program be given? When there is more than one firm being regulated the firms’ decision problems—otherwise completely separate—become linked in a way that depends on that mission. Under some sorts of missions firms compete to avoid the attention of the enforcer by competitive reductions in the extent of their non-compliance, in others the interaction encourages competitive expansions. We develop a general model that allows for the ordering of some typical classes of missions. We find that in plausible settings ‘target-driven’ missions (that set a hard target in terms of environmental outcome but flexible budget) achieve the same outcome at lower cost than ‘budget-driven’ ones (that fix the enforcement budget). Inspection of some fixed fraction of firms is never optimal.

Item Type: Article
Schools and Departments: School of Business, Management and Economics > Economics
Subjects: H Social Sciences > HB Economic theory. Demography > HB0071 Economics as a science. Relation to other subjects
Depositing User: Catrina Hey
Date Deposited: 11 Oct 2013 10:25
Last Modified: 11 Oct 2013 10:25
URI: http://sro.sussex.ac.uk/id/eprint/46651
📧 Request an update