Intertemporal Emissions Trading and Allocation Rules: Gainers, Losers and the Spectre of Market Power
Chevallier, Julien (2010), Intertemporal Emissions Trading and Allocation Rules: Gainers, Losers and the Spectre of Market Power, International Journal of Ecological Economics and Statistics, 18, S10, p. 1-19
TypeArticle accepté pour publication ou publié
External document linkhttp://halshs.archives-ouvertes.fr/halshs-00124713/fr/
Journal nameInternational Journal of Ecological Economics and Statistics
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Abstract (EN)Stemming from politically given market imperfections in a tradeable permits system, we develop a Stackelberg game model to describe how a large agent may exercise market power at the expense of a competitive fringe. In a dynamic framework with banking and borrowing, we explore how to restore the market equilibrium with an optimal allocation of permits. Overall, these results yield a better understanding of market mechanisms - and their potential for failure - to deliver CO2 emissions reductions needded to fight against climate change, and may be of interest for a wider audience composed of academic researchers and policy makers in the climate change policy arena.
Subjects / KeywordsDifferential Game; Market Power; Borrowing; Banking; emissions trading
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The EU emissions trading scheme : The effects of industrial production and CO2 emissions on carbon prices Alberola, Emilie; Chevallier, Julien; Chèze, Benoît (2008) Article accepté pour publication ou publié