Emission Quota Trade among the Few: Laboratory Evidence of Joint Implementation among Committed Countries The Complete Version

Peter Bohm and Björn Carlén ()
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Peter Bohm: Dept. of Economics, Stockholm University, Postal: Department of Economics, Stockholm University, S-106 91 Stockholm, Sweden
Björn Carlén: Dept. of Economics, Stockholm University, Postal: Department of Economics, Stockholm University, S-106 91 Stockholm, Sweden

No 1997:5, Research Papers in Economics from Stockholm University, Department of Economics

Abstract: The purpose of the laboratory tests reported here is to identify a well-functioning design, tailored for an upcoming unique experiment using real-world relevant decision makers for carbon emission reduction trade among four countries committed to binding carbon emission limits, a form of so-called joint implementation. For reasons given in the paper, the design is required to promote high trade efficiency and a small scope for arbitrage. All designs tested reached high levels of efficiency (87-99%), which is noteworthy given the small number of traders. Attempts to adjust design to reduce or eliminate arbitrage were successful in the final test rounds.

Keywords: carbon emission reduction trade; joint implementation; experimental economics (search for similar items in EconPapers)
JEL-codes: A23 Q28 (search for similar items in EconPapers)
Pages: 38 pages
Date: 1998-05-06
New Economics Papers: this item is included in nep-exp and nep-pub
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Published in Resource and Energy Economics, 1999, pages 43-66.

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Persistent link: https://EconPapers.repec.org/RePEc:hhs:sunrpe:1997_0005

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