Date
2008
Indexation documentaire
Economie de la terre et des ressources naturelles
Subject
Banking borrowing; Emissions trading
Code JEL
C73; L11; Q52
Nom de la revue
Economics Bulletin
Volume
17
Numéro
14
Date de publication
07-2008
Pages article
1-9
Nom de l'éditeur
Economics Bulletin
Auteur
Chevallier, Julien
Type
Article accepté pour publication ou publié
Résumé en anglais
This paper considers a permit market with both spatial and intertemporal trading. The intertemporal market allows firms to freely borrow or bank permits over a pre-specified period of time. When this period is over, the permit bank has to be balanced, so firms cannot avoid compliance just by borrowing from the future. Market power is introduced by assuming a large dominant agent in a Stackelberg position and a large number of small firms who are nonstrategic but forward looking. The equilibrium is characterized by for the monopoly case and for intermediate cases.