Strategic trade in pollution permits

Dickson, Alexander and MacKenzie, Ian A. (2016) Strategic trade in pollution permits. Working paper. Strathclyde Discussion Papers in Economics, Glasgow.

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    Abstract

    Markets for pollution have become a popular regulatory instrument. Yet these markets are often highly concentrated, which may lead to strategic behavior by all participants. In this article we investigate the implications of strategic trade in pollution permits. The permit market is developed as a strategic market game, where all firms are allowed to behave strategically and their roles as buyers or sellers of permits are determined endogenously with price-mediated trade. In a second stage, firms transact on a product market and we allow for a variety of market structures. Our framework establishes the endogenous determination of equilibrium price, market structure, and levels of exchange in the permit market.

    Creators(s): Dickson, Alexander ORCID logoORCID: https://orcid.org/0000-0001-9386-9036 and MacKenzie, Ian A.;
    Item type:Monograph(Working paper)
    ID code:57146
    Keywords:pollution market, market power, strategic market game, Commerce, Economics, Econometrics and Finance(all)
    Subjects:Social Sciences > Commerce
    Department:Strathclyde Business School > Economics
    Depositing user: Pure Administrator
    Date deposited:27 Jul 2016 15:31
    Last modified:19 Feb 2021 04:03
    URI:https://strathprints.strath.ac.uk/id/eprint/57146
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