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Information and Pollution Permit Markets

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Author Info
David Colander ()

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Abstract

In a recent article Smith and Yates (Smith and Yates, 2003) argued that regulators could gain additional information about the optimal number of permits to issue from two-sided markets. This paper argues that they are incorrect in their assertion because the market they refer to is an asymmetric two-sided market in which individuals are only allowed to decrease the number of permits. When a corrct two-sided market is considered, the public good nature of the problem makes it unlikely that any useful information can come from a two-sided market.

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File URL: http://www.middlebury.edu/services/econ/repec/mdl/ancoec/0321.pdf
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Paper provided by Middlebury College, Department of Economics in its series Middlebury College Working Paper Series with number 0321.

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Length: 5 pages
Date of creation: Aug 2003
Date of revision:
Handle: RePEc:mdl:mdlpap:0321

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