We analyze the design of optimal environmental policy when environmentaldamage is uncertain and investments in abatement technologies are irreversible. Weassume that the investment in the new abatement technology can be used for twoperiods and that the true extent of environmental damage will...

We summarize and review the literature on two types of economic experiments. First we discuss the use of experimental laboratories to testbed market solutions to issues in environmental policy. We concentrate on experiments with one and two-sided markets, and applications in the domain of water...