Angelopoulos, Konstantinos; Economides, George; … - Bank of Greece - 2010
, pollution permits are the worst recipe, even when their revenues are used to finance public abatement. When the main source of … uncertainty is economic, the best recipe is to levy taxes (on pollution or output) and use the collected tax revenues to finance … public finance. The setup is the basic stochastic neoclassical growth model augmented with the assumptions that pollution …