A Generalized Hybrid Approach to Controlling Emissions
AbstractThis paper examines the optimal instrument choice to control emissions under uncertainty. A hybrid regulation mechanism is developed that contains cap-and-trade, emissions taxes and socalled safety valves as special cases. This makes it possible to examine optimal policy choice and the resulting efficiency losses for each instrument. It is shown that the hybrid regulation mechanism in efficiency terms is weakly superior to the other instruments. The model is also used to study optimal response to non-optimal policy implementations.
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Bibliographic InfoPaper provided by Stockholm University, Department of Economics in its series Research Papers in Economics with number 2004:17.
Length: 18 pages
Date of creation: 10 Nov 2004
Date of revision:
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Postal: Department of Economics, Stockholm, S-106 91 Stockholm, Sweden
Phone: +46 8 16 20 00
Fax: +46 8 16 14 25
Web page: http://www.ne.su.se/
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Emissions tax; Emissions trading; Safety valve; Ranking; Uncertainty;
Find related papers by JEL classification:
- H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
- Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
- 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-2004-12-20 (All new papers)
- NEP-ENE-2004-12-20 (Energy Economics)
- NEP-ENV-2004-12-20 (Environmental Economics)
- NEP-RES-2004-12-20 (Resource Economics)
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