EconPapers    
Economics at your fingertips  
 

An Experimental Analysis of Compliance in Dynamic Emissions Markets

John Stranlund (), James Murphy () and John Spraggon ()

No 2011-01, Working Papers from University of Alaska Anchorage, Department of Economics

Abstract: Two important design elements for emission trading programs are whether and to what extent firms are able to bank emissions permits, and how these programs are to be enforced. In this paper we present results from laboratory emissions markets designed to investigate enforcement and compliance when these markets allow permit banking. Banking is motivated by a decrease in the aggregate permit supply in the middle of multi-period trading sessions. Consistent with theoretical insights, our experiments suggest that high permit violation penalties have little deterrence value in dynamic emissions markets, and that the main challenge of enforcing these programs is to motivate truthful self-reports of emissions.

Keywords: Compliance; Enforcement; Emissions trading; Laboratory experiments; Permit markets; Permit banking; experimental economics; environmental economics (search for similar items in EconPapers)
JEL-codes: C91 L51 Q58 C90 (search for similar items in EconPapers)
Date: 2011-04
New Economics Papers: this item is included in nep-ene, nep-env and nep-exp
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (28) Track citations by RSS feed

Published in Journal of Environmental Economics and Management, 62(3):414-429.

Downloads: (external link)
http://econpapers.uaa.alaska.edu/RePEC/ala/wpaper/ALA201101.pdf (application/pdf)

Related works:
Journal Article: An experimental analysis of compliance in dynamic emissions markets (2011) Downloads
Working Paper: An Experimental Analysis of Compliance in Dynamic Emissions Markets (2010) Downloads
Working Paper: An Experimental Analysis of Compliance in Dynamic Emissions Markets (2010) Downloads
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:ala:wpaper:2011-01

Access Statistics for this paper

More papers in Working Papers from University of Alaska Anchorage, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Jonathan Alevy ().

 
Page updated 2021-02-20
Handle: RePEc:ala:wpaper:2011-01