IDEAS home Printed from
   My bibliography  Save this article

International emissions trading: Good or bad?


  • Holtsmark, Bjart
  • Sommervoll, Dag Einar


Using a non-cooperative climate policy game applied in the literature, we find that an agreement with international emissions trading leads to increased emissions and reduced efficiency.

Suggested Citation

  • Holtsmark, Bjart & Sommervoll, Dag Einar, 2012. "International emissions trading: Good or bad?," Economics Letters, Elsevier, vol. 117(1), pages 362-364.
  • Handle: RePEc:eee:ecolet:v:117:y:2012:i:1:p:362-364 DOI: 10.1016/j.econlet.2012.05.034

    Download full text from publisher

    File URL:
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    1. Cramton Peter & Stoft Steven, 2010. "Price Is a Better Climate Commitment," The Economists' Voice, De Gruyter, vol. 7(1), pages 1-7, February.
    2. Helm, Carsten, 2003. "International emissions trading with endogenous allowance choices," Journal of Public Economics, Elsevier, vol. 87(12), pages 2737-2747, December.
    3. Carbone, Jared C. & Helm, Carsten & Rutherford, Thomas F., 2009. "The case for international emission trade in the absence of cooperative climate policy," Journal of Environmental Economics and Management, Elsevier, vol. 58(3), pages 266-280, November.
    4. Odd Godal & Bjart Holtsmark, 2011. "Permit Trading: Merely an Efficiency‐Neutral Redistribution away from Climate‐Change Victims?," Scandinavian Journal of Economics, Wiley Blackwell, vol. 113(4), pages 784-797, December.
    5. MacKenzie, Ian A., 2011. "Tradable permit allocations and sequential choice," Resource and Energy Economics, Elsevier, vol. 33(1), pages 268-278, January.
    6. Finus, Michael, 2008. "Game Theoretic Research on the Design of International Environmental Agreements: Insights, Critical Remarks, and Future Challenges," International Review of Environmental and Resource Economics, now publishers, vol. 2(1), pages 29-67, June.
    7. Peter Cramton & Steven Stoft, 2010. "International Climate Games: From Caps to Cooperation," Papers of Peter Cramton 10icg, University of Maryland, Department of Economics - Peter Cramton, revised 2010.
    Full references (including those not matched with items on IDEAS)


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Bodansky, Daniel M. & Hoedl, Seth A. & Metcalf, Gilbert E. & Stavins, Robert N., 2014. "Facilitating Linkage of Heterogeneous Regional, National, and Sub-National Climate Policies through a Future International Agreement," Working Paper Series rwp14-056, Harvard University, John F. Kennedy School of Government.
    2. Böhringer, Christoph & Dijkstra, Bouwe & Rosendahl, Knut Einar, 2014. "Sectoral and regional expansion of emissions trading," Resource and Energy Economics, Elsevier, vol. 37(C), pages 201-225.
    3. Wolfgang Habla & Ralph Winkler, 2017. "Strategic Delegation and International Permit Markets: Why Linking May Fail," CESifo Working Paper Series 6515, CESifo Group Munich.
    4. repec:zbw:hohpro:337-11 is not listed on IDEAS
    5. Nachtigall, Daniel, 2016. "Linking Emissions Trading Schemes in the Presence of Research and Develoment Spillovers," Annual Conference 2016 (Augsburg): Demographic Change 145721, Verein für Socialpolitik / German Economic Association.
    6. repec:gam:jsusta:v:10:y:2018:i:2:p:287-:d:128246 is not listed on IDEAS
    7. Baran Doda, Simon Quemin, Luca Taschini, 2017. "A theory of gains from trade in multilaterally linked ETSs," GRI Working Papers 275, Grantham Research Institute on Climate Change and the Environment.
    8. repec:old:wpaper:337-11 is not listed on IDEAS
    9. Bjart Holtsmark & Dag Einar Sommervoll, 2012. "International emissions trading in a noncooperative climate policy game," Discussion Papers 693, Statistics Norway, Research Department.
    10. Holtsmark, Katinka & Midttømme, Kristoffer, 2015. "The Dynamics of Linking Permit Markets," Memorandum 02/2015, Oslo University, Department of Economics.
    11. Simon Quemin & Christian de Perthuis, 2017. "Transitional restricted linkage between Emissions Trading Schemes," Working Papers 1701, Chaire Economie du climat.

    More about this item


    Climate change; International environmental agreements; Emissions trading; Non-cooperative game theory;

    JEL classification:

    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
    • Q2 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ecolet:v:117:y:2012:i:1:p:362-364. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.