| It has been increasingly recognised that regulators are facing difficulties monitoring the emissions of polluting firms and enforcing environmental standards. Increasing the quantity of monitoring activities and improving the quality of these activities may prove to be very costly; raising fines and penalties, though simple, may not be optimal. Regulators have tried to develop innovative approaches in order to improve environmental quality and induce compliance with environmental standards without necessarily engaging a larger amount of (scarce) resources to achieve this objective. To this extent, information is becoming an important policy tool. The purpose of this thesis is to examine various aspects of the role of information as a tool to increase environmental quality and obtain compliance with environmental standards. Some of these innovative approaches rely on providing information to consumers about polluting products. It is then hoped that informed and environmentally aware consumers will change the pollution profile of the goods that are produced and consumed. In the first chapter of this thesis, we examine whether or not the regulator has a role in providing information about products whose consumption and/or production pollutes the environment. We examine how this role, if any, is changed when the regulator has also access to other tools of intervention, namely pollution taxation. Another innovative approach is to provide investors with information on firms that do not comply with environmental standards. In Chapter 2, we analyze the impact of such information on a firm's value. The negative impact on a firm's value, if any, may be perceived as an additional penalty and a further incentive to comply with environmental standards. Finally, in Chapter 3, we show that the regulator cannot ignore the structure of the market when introducing environmental regulation and that this same market structure is a source of information that can be used by the regulator to allocate its monitoring resources so as to increase expected compliance with the environmental regulation. |
