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| Huhtala, Anni; Eerola, Essi. |
| We examine the design of policies for promoting the consumption of green products under preference and income heterogeneity using organic food products as an example. Two instruments are considered: a price subsidy for the organic food products and a tax on the conventional products. Under income disparity, consumers with high income always prefer a socially optimal subsidy to a socially optimal tax, while low-income consumers prefer a tax on conventional products. When environmental policy is determined by the median voter, the policies implemented tend to be stricter than socially optimal policies if income differences are large. |
| Tipo: Working or Discussion Paper |
Palavras-chave: Environmental Economics and Policy. |
| Ano: 2005 |
URL: http://purl.umn.edu/11863 |
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