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| Hahn, Robert W.; Stavins, Robert N.. |
| We examine an implication of the “Coase Theorem” which has had an important impact both on environmental economics and on public policy in the environmental domain. Under certain conditions, the market equilibrium in a cap-and-trade system will be cost-effective and independent of the initial allocation of tradable rights. That is, the overall cost of achieving a given aggregate emission reduction will be minimized, and the final allocation of permits will be independent of the initial allocation. We call this the independence property. This property is very important because it allows equity and efficiency concerns to be separated in a relatively straightforward manner. In particular, the property means that the government can establish the overall... |
| Tipo: Working or Discussion Paper |
Palavras-chave: Cap-and-Trade System; Tradable Permits; Coase Theorem; Allowance Allocation; Environmental Economics and Policy; Q580; H110; L510. |
| Ano: 2010 |
URL: http://purl.umn.edu/92707 |
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| Demailly, Damien; Quirion, Philippe. |
| We assess five proposals for the future of the EU greenhouse gas Emission Trading Scheme (ETS): pure grandfathering allocation of emission allowances (GF), output-based allocation (OB), auctioning (AU), auctioning with border adjustments (AU-BA), and finally output-based allocation in sectors exposed to international competition combined with auctioning in electricity generation (OB-AU). We look at the impact on production, trade, CO2 leakage and welfare. We use a partial equilibrium model of the EU 27 featuring three sectors covered by the EU ETS – cement, steel and electricity – plus the aluminium sector, which is indirectly impacted through a rise in electricity price. The leakage ratio, i.e. the increase in emissions abroad over the decrease in EU... |
| Tipo: Working or Discussion Paper |
Palavras-chave: Emission Trading; Allowance Allocation; Leakage; Spillover; Climate Policy; Kyoto Protocol; Border Adjustment; Environmental Economics and Policy; Q5. |
| Ano: 2008 |
URL: http://purl.umn.edu/46623 |
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