PUBLIC MECHANISMS TO SUPPORT COMPLIANCE TO AN ENVIRONMENTAL NORM

Two regimes to support compliance to an environmental norm are compared. Under the first, compliance to the rule is mandatory and is supported by a fine on noncompliance. Under the second, compliance is voluntary and is supported by government efforts to reduce the cost of compliance. Satisfaction of the necessary and sufficient condition under which a voluntary compliance regime dominates an alternative mandatory compliance regime depends on whether or not public effort is rival, the degree of excludability of public effort, and the relative prices of private and public effort. (C) 1995 Academic Press, Inc.