Emission permit management with a self-interested regulator

Palokangas, T. (2015). Emission permit management with a self-interested regulator. HECER Discussion Paper No.390, University of Helsinki , Helsinki, Finland.

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Heterogeneous countries produce goods from fixed resources and emitting inputs that cause simultaneous localized and global extenality problems (e.G. smog and global warming). Since there is no benevolent international government, the issue of emission permits is delegated to an international self-interested regulator whom the countries try to influence. A single country can exceed its emission permits with a fixed penalty. In this setup, this article shows that emission trading is welfare diminishing, because it grants less (more) permits to countries with realtively clean (dirty) localized technology.

Item Type: Other
Uncontrolled Keywords: smog; GHG emissions; emission quotas; emission trading; lobbying
Research Programs: Advanced Systems Analysis (ASA)
Depositing User: Luke Kirwan
Date Deposited: 26 Jan 2016 13:23
Last Modified: 27 Aug 2021 17:40
URI: https://pure.iiasa.ac.at/11845

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