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Abstract

A simple model of “hourglass†problems is presented. For such problems, the benefit of a national policy measure is propagated to all countries through one single world-wide variable. The prime example is the effect of the reduction of CO 2 emission on the world climate. Five optimal solutions are given, for various situations and points of view, followed by a comparison with the outcome of permit trading.

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Bibliographic Info

Paper provided by CPB Netherlands Bureau for Economic Policy Analysis in its series CPB Memorandum with number 238.

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Date of creation: Feb 2010
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Handle: RePEc:cpb:memodm:238

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Find related papers by JEL classification:

• F5 - International Economics - - International Relations and International Political Economy
• Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
• Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
• Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters
• Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

This paper has been announced in the following NEP Reports:

• NEP-ALL-2010-03-20 (All new papers)
• NEP-ENE-2010-03-20 (Energy Economics)
• NEP-ENV-2010-03-20 (Environmental Economics)

References

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1. Hahn, Robert W., 1982. "Market Power and Transferable Property Rights," Working Papers 402, California Institute of Technology, Division of the Humanities and Social Sciences.
   
   • Hahn, Robert W, 1984. "Market Power and Transferable Property Rights," The Quarterly Journal of Economics, MIT Press, vol. 99(4), pages 753-65, November.
2. Wirl, Franz, 2009. "Oligopoly meets oligopsony: The case of permits," Journal of Environmental Economics and Management, Elsevier, vol. 58(3), pages 329-337, November.
3. David Anthoff & Cameron Hepburn & Richard S.J. Tol, 2007. "Equity Weighting and the Marginal Damage Costs of Climate Change," Working Papers 2007.43, Fondazione Eni Enrico Mattei.
   
   • Anthoff, David & Hepburn, Cameron & Tol, Richard S.J., 2009. "Equity weighting and the marginal damage costs of climate change," Ecological Economics, Elsevier, vol. 68(3), pages 836-849, January.
   • David Anthoff & Cameron Hepburn & Richard S.J. Tol, 2006. "Equity weighting and the marginal damage costs of climate change," Working Papers FNU-121, Research unit Sustainability and Global Change, Hamburg University, revised Dec 2006.
4. Mulder, Machiel & ten Cate, Arie & Zwart, Gijsbert Zwart, 2007. "The economics of promoting security of energy supply," EIB Papers 8/2007, European Investment Bank, Economics Department.

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Cited by:

1. Arie ten Cate, 2012. "The socially optimal energy transition in a residential neighbourhood in the Netherlands," CPB Discussion Paper 222, CPB Netherlands Bureau for Economic Policy Analysis.

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