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Emission Taxes and Tradeable Permits A Comparison of Views on Long-Run Efficiency

  • John Pezzey


We compare three different views on the long runefficiencies of emission taxes which includethresholds (inframarginalexemptions), and of tradeable emission permitswhere some permits areinitially free. The differences are caused bydifferent assumptions aboutwhether thresholds and free permits should besubsidies given only to firmsthat produce, or full property rights. Treatingtax thresholds, as well asfree permits, as property rights would departfrom the conventional view,but would allow greater flexibility in makingeconomic instruments bothefficient and acceptable. Such flexibilitycould be very important inachieving efficient control of greenhouse gasemissions. Copyright Kluwer Academic Publishers 2003

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Article provided by European Association of Environmental and Resource Economists in its journal Environmental and Resource Economics.

Volume (Year): 26 (2003)
Issue (Month): 2 (October)
Pages: 329-342

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Handle: RePEc:kap:enreec:v:26:y:2003:i:2:p:329-342
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  1. Pezzey, John C.V., 2003. "Emission Taxes and Tradable Permits: A Comparison of Views on Long Run Efficiency," 2003 Conference (47th), February 12-14, 2003, Fremantle, Australia 58198, Australian Agricultural and Resource Economics Society.
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  15. Peter Cramton & Suzi Kerr, 1999. "The Distributional Effects of Carbon Regulation: Why Auctioned Carbon Permits are Attractive and Feasible," Papers of Peter Cramton 99eedecr, University of Maryland, Department of Economics - Peter Cramton, revised Feb 1998.
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  24. John Pezzey, 1992. "The Symmetry between Controlling Pollution by Price and Controlling It by Quantity," Canadian Journal of Economics, Canadian Economics Association, vol. 25(4), pages 983-91, November.
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  34. repec:cup:cbooks:9780521322249 is not listed on IDEAS
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