Abstract

Many governments set up different environmental regimes with respect to different industries. Taiwan’s government uses the environmental standard regime to regulate the adhesive tape manufacturing industry and the emission tax regime to regulate the cement manufacturing industry. We here are interested about whether the environmental standard is the welfare-superior regime to Taiwan’s adhesive tape manufacturing industry. Our study shows that the environmental standard may not be a welfare-superior regime to this industry. This result is different from Naito and Ogawa (2009) who consider the relation between the environmental regime and the privatization degree. We also conclude there is an environmental preference inconsistency between the patentee and the social planner when the innovator is a domestic firm.

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