Voluntary provision of public goods for bads
Subtitle: a theory of environmental offsets
By: Matthew J. Kotchen
Contributors: National Bureau of Economic Research
Series: NBER working paper series -- working paper 13643; Working paper series (National Bureau of Economic Research : Online) -- working paper no. 13643.
Publisher: National Bureau of Economic Research
Published: 2007
Place of publication: Cambridge, MA
Language: eng
Format: [electronic resource] :
Description: "This paper examines voluntary provision of a public good that is motivated, in part, to compensate for other activities that diminish the public good.  Markets for environmental offsets, such as those that promote carbon neutrality to minimize the impact of climate change, provide an increasingly salient example.  An important result, related to one shown previously, is that mean donations to the public good do not converge to zero as the economy grows large.  Other results are new and comparable to those from the standard model of a privately provided public good.  The Nash equilibrium is solved explicitly to show how individual direct donations and net contributions depend on wealth and heterogenous preferences.  Comparative static analysis demonstrates how the level of the public good and social welfare depend on the technology, individual wealth, and an initial level of the public good.  Application of the model in an environmental context establishes a starting point for understanding and making predictions about markets such as those for carbon offsets"--National Bureau of Economic Research web site.
Notes: Title from PDF file as viewed on 12/12/2007.

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