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Led on the Wrong Track? A Note on the Direction of Technical Change under Environmental Liability Law
Author(s) -
ENDRES ALFRED,
FRIEHE TIM
Publication year - 2013
Publication title -
journal of public economic theory
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.809
H-Index - 32
eISSN - 1467-9779
pISSN - 1097-3923
DOI - 10.1111/jpet.12022
Subject(s) - liability , technical change , economics , law and economics , strict liability , track (disk drive) , law , political science , macroeconomics , computer science , accounting , productivity , operating system
This note shows that polluters might opt for technical change which is inferior to other innovations from a social standpoint under environmental liability law. Polluters choose what is socially optimal under strict liability. However, we show that it is possible to have not only too little or too much technical change of a given kind but, importantly, also the wrong kind of technical change under negligence.