Strategic Choice of Domestic Environmental Policy Instrument and International Emissions Trading Scheme in an Open Economy with Imperfect Competition

Jan Tjeerd Boom

No 24177, Unit of Economics Working Papers from Royal Veterinary and Agricultural University, Food and Resource Economic Institute

Abstract: This paper presents a model of imperfect international competition. Within this framework, the optimal choice of national environmental policy instrument and international emissions trading scheme is discussed. The choice of national instrument is restricted to absolute and relative standards, which form the basis for permit and credit trading respectively. It is shown that relatives standards and credit trading lead to higher output than emission ceilings and permit trading. I find that governments want to increase production beyond the level reached with emission ceilings and therefore prefer relative standards. Furthermore, international emissions trading is only optimal when the country imports emission quotas, and in several cases, governments will choose not to allow international emissions trading.

Keywords: Environmental; Economics; and; Policy (search for similar items in EconPapers)
Pages: 26
Date: 2003
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/24177/files/ew030005.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:rvaewp:24177

DOI: 10.22004/ag.econ.24177

Access Statistics for this paper

More papers in Unit of Economics Working Papers from Royal Veterinary and Agricultural University, Food and Resource Economic Institute Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().