A Mathematical Model for Selecting the Optimum Norms of Regulating Economic Activity

Resumo

A theoretical model is presented for selecting the norms of regulating the economical activity of enterprises under the assumption that negative ghost effects exist. Markets with perfect competition are investigated. The model is based on the principle of maximizing public welfare and can be applied to different norms established by regulatory authorities. An explicit expression is proposed for computing the optimum sanitary norms concerning the concentration of harmful substances.