Environmental Pollution Control And The Regulation Game

By Applied Statistics, Econometrics, Game theory, Environmental Economic theoryand Optimization theory, the thesis focus on the Game Analysis for environment pollutioncontrol and environmental regulation, and study on the relationship between environmentalpollution and economic development, Game of environmental pollution control andenvironmental regulation issues.In particular, based on the game theory perspective, the author analyzed the gamestrategy between firms, local government and central governmen in the environmentalpollution control, Transboundary pollution control strategy equilibrium problem, Study thecarbon tax regulation and collusion problems during the auctions on emission rights, thenmade recommendations on the regulation of environment pollution control.The main studies presented in this dissertation have been outlined as followings:1.The analysis of the relationship between environmental pollution and economicdevelopment.(1) a non-dimensional environmental aggregative pollution indicator wascalculated with the principal component analysis method; by applying econometricsmethods, a quantitative analysis was made on the long-term equilibrium relationshipbetween Chinese environment pollution and economic growth, it is concluded that therelation of Chinese environment pollution and economic growth is in accordance with theenvironmental Kuznets curve. The Granger causality test shows that there is a causalrelationship between the environmental pollution and the economic growth. China hasbeen in the downward phase of EKC, this means the economic development of our countrywill be impacted with the deterioration of environmental pollution;(2) the negativeexternalities characteristics of environmental pollution lead to the failure of the marketmechanisms on allocating the environment resources, and the initiation of the loss of socialwelfare. Environmental pollution spreading will also cause the environment unfairnessamong regions, urban and rural areas. The market mechanisms can not self-regulate thenegative effects of the environmental pollution. Hence, to control the environmentpollution, it is required that government to establish an effective regulations and overcomethe market failure.2. Carried out the game analysis of the national environmental pollution control.(1)The game analysis on correlation of the enterprises’ sewage and government regulationsshows: Whether an enterprise sewages and Government regulates is determined by theenterprises’ profit expectation difference between no-sewage and sewage costs,government environmental supervision costs, law enforcement costs, and the scale of the punishment on the sewage. If there is less punishment made by the government on thesewage cost, there will be the greater prospective earning, and less reputation cost for anenterprise;(2) The tripartite mixed strategy game analysis result shows that You can getthe corporate and local government collusion strategy selected on the basis of whether ornot, as well as the central government to select regulatory. If there is greater punishmentfrom the central government on the local businesses and local governments, the localgovernment officials will gain greater rent via collusions with the sewage enterprises; ifthere is less punishment from the central government, local governments are more likely tochoose collusion with sewage companies.3. The transboundary environmental pollution control game study. By establishing agame model with neighboring countries and multiple countries as the players oncross-border pollution control, this dissertation also studied the players’ strategies about thetransboundary pollution control. Under strict assumptions, the total amount with Nashequilibrium to pollution control is always less than the total amount of emissions to Paretooptimality. To reduce the difference under the two conditions, each game player needs fullcooperation on the pollution control.Hence, the operation of the global greenhouse gas emissions, to downgrade thegreenhouse gas emissions to an expected range, individual involved country needs to takean active role to undertake emission reduction obligations, in particular, a country withgreater economy power should take the primary responsibility, so an effective agreementon greenhouse gas emission reduction could be reached.4. Study on the Sewage tax issues of the environmental regulation. A governmentshould take full account of the impacts on different producers while developing sewageTax standards. By applying the optimization theory and methodology, this study did theanalysis on the impact of sewage tax levy:(1) Assuming that the production technologyremain unchanged, if the pollutant emissions tax is to be levied per unit of emission output,the profit from the high-pollution commodities will be lower, thus The stimulus for theproduction of high-polluting goods will be reduced;(2) If the pollutant emissions tax israised, productive resources invested in high-polluting sectors will decrease, the resourcesof pollution abatement activities will increase, and the overall resources in the sector ofhigh pollution will be reduced. Therefore, as long as the marginal abatement cost is lowerthan the pollutant emissions tax, a monopoly producer will reduce the emissions ofpollutants. The pollutant emission taxes under monopoly conditions can play a significantrole on regulating the environmental pollution. 5. Analysed the issues of auction and collusion on the emission rights during theenvironmental regulation. By applying optimization theory and incentive mechanismtheory, this study examined the collusion during the auction of the emission rights.With the second-price sealed auction on emission rights auction, the auction ofconspiracy to the existence of cartels does not affect bidding strategy and expected payoffsof the bidders without collusion carter.With the number of collusion carter’s members increasing, they will make moreprofits. Therefore, the most effective collusion is that all bidders are involved. To preventbidders’ collusion, the auctioneer should take higher public reserve price if the number ofcollusion carter’s members increasing. In particular, the optimal public reserve price withcollusion carter should be higher than that of no collusion carter.The studies presented in this dissertation aims to provide a theoretical basis andreference for the development of effective environmental protection policies and theselection of scientific environmental pollution regulatory tools.