Emissions Trading and Profitability: The Swedish Pulp and Paper Industry
AbstractThe purpose of this paper is to develop models with and without emissions trading and to compare industry profits under the two regimes. The model in which emissions trading is permitted is a nonparametric industry frontier model in the spirit of Fare, Grosskopf and Li (1992). It is relative to this model that industry profit is computed. This profit is compared to the profit without emissions trading to give an estimate of the potential gains that can be realised by allowing for emissions trading. The model, which is applied to data for the Swedish pulp and paper industry, thus provides evidence as to the cost efficiency of the prevailing individual regulations for this particular industry.
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Bibliographic InfoPaper provided by EconWPA in its series Others with number 9506001.
Length: 14 pages
Date of creation: 30 Jun 1995
Date of revision:
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environmental economics; natural resource economics; industry;
Find related papers by JEL classification:
- P - Economic Systems
- Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics
- Z - Other Special Topics
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- Fare, Rolf & Grosskopf, Shawna & Li, Sung-Ko, 1992. " Linear Programming Models for Firm and Industry Performance," Scandinavian Journal of Economics, Wiley Blackwell, vol. 94(4), pages 599-608.
- Yangho Chung & Rolf Fare, 1995. "Productivity and Undesirable Outputs: A Directional Distance Function Approach," Microeconomics 9511002, EconWPA, revised 08 Nov 1995.
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