International emissions trading in a non-cooperative equilibrium

Arbeitspapier

Linkage of different countries' domestic permit markets for pollution rights into a single international market alters governments' incentives, and may trigger adjustments of the number of allocated permits. First, this work finds that in a non-cooperative equilibrium, international emissions trading is likely to increase the total emissions. Second, although trading will give a more efficient cross-country allocation of emissions, efficiency may nevertheless fall, because an already inefficiently low abatement level is likely to be further reduced. Third, we find that large countries are likely to experience losses from linking their permit markets to the permit markets of smaller countries.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Discussion Papers ; No. 542

Classification and Topics

• Classification: Wirtschaft ; Noncooperative Games ; International Agreements and Observance; International Organizations ; Climate; Natural Disasters and Their Management; Global Warming
• Subject: Emissions trading ; efficiency ; non-cooperative games

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Holtsmark, Bjart J. ; Sommervoll, Dag Einar
• Event: Veröffentlichung
• (who): Statistics Norway, Research Department
• (where): Oslo
• (when): 2008

Further information

• Handle: http://hdl.handle.net/10419/192524
• Last update: 10.03.2025, 11:42 AM CET