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Published online by Cambridge University Press: 02 December 2020
This chapter discusses various applications of the analytical framework here. First, we identify the Lindahl tax that serves as the fourth component adding to the triangular equivalence relationship. Under the Lindahl tax scheme, the Cournot-Nash equilibrium of SEEN or DEEN model renders the Lindahl equilibrium without transfers. We examine the quantity tools as well. To showcasing the relevance and importance of the theory in empirical works, we solve the Lindahl equilibrium without transfer and coalitional solutions in the influential RICE model. Lastly, we analyse the one-directional externality problem in a water pollution model. All cases of applications are supplemented with programming codes and/or numerical results.
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