This paper examines green alliances between environmental groups (EGs) and polluting firms, which have become more common in the last decades, and analyzes how they affect policy design. We first show that the activities of regulators and EGs are strategic substitutes, giving rise to free-riding incentives on both agents. Nonetheless, the presence of the EG yields smaller welfare benefits when firms are subject to regulation than when they are not. In addition, the introduction of environmental policy yields large welfare gains when the EG is absent but small benefits when the EG is already present.

中文翻译：

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监管机构和环保团体：更好还是分开？

本文研究了环保组织 (EG) 和污染企业之间的绿色联盟，这种联盟在过去几十年中变得越来越普遍，并分析了它们如何影响政策设计。我们首先表明，监管机构和 EG 的活动是战略替代品，从而对双方都产生了搭便车的激励。尽管如此，当公司受到监管时，EG 的存在产生的福利收益比不受监管时要小。此外，环境政策的引入在 EG 不存在时会产生巨大的福利收益，但在 EG 已经存在时会产生很小的收益。