Espínola-Arredondo, Ana; Zhao, Huan - In: Environment and Development Economics 17 (2012) 04, pp. 461-477
This paper analyzes how a tax/subsidy policy affects consumers' behavior when choosing between green (pollution-free goods) and conventional products, and its effects on welfare when a proportion of consumers have strong preferences for green goods. We analyze a Hotelling's linear city model...