Strategic trade in pollution permits

Dickson, Alex and MacKenzie, Ian A. (2018) Strategic trade in pollution permits. Journal of Environmental Economics and Management, 87. pp. 94-113. ISSN 0095-0696

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    Abstract

    Markets for pollution have become a popular regulatory instrument. 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. We identify a unique equilibrium in permit exchange, investigate the properties of this equilibrium, and consider the effect of strategic behavior in the product market.

    Author(s):Dickson, Alex ORCID logoORCID: https://orcid.org/0000-0001-9386-9036 and MacKenzie, Ian A.
    Item type:Article
    ID code:60839
    Keywords:pollution market, market power, strategic market game, Commerce, Environmental Sciences, Management, Monitoring, Policy and Law, Pollution, Economics and Econometrics
    Subjects:Social Sciences > Commerce
    Geography. Anthropology. Recreation > Environmental Sciences
    Department:Strathclyde Business School > Economics
    Depositing user: Pure Administrator
    Date deposited:06 Jun 2017 00:55
    Last modified:06 Dec 2019 05:09
    Related URLs:
    URI:https://strathprints.strath.ac.uk/id/eprint/60839
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