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The clean development mechanism in a global carbon market

Author

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  • BRECHET, Thierry

    (Université catholique de Louvain, CORE & LSM, Belgium)

  • meniere, Yann

    (Ecole des Mines de Paris, CERNA)

  • PICARD, Pierre M.

    (Université catholique de Louvain, CORE, Belgium; CREA, University of Luxembourg)

Abstract

This paper discusses the role of the Clean Development Mechanism (CDM) on the market for carbon quotas and countries' commitments to reduce their carbon emission levels. We show that the CDM contributes to an efficient funding of clean technology investments in least developed countries. However, the CDM is not neutral on the global level of carbon emissions as it entices countries to raise their emission caps. The CDM may also make inappropriate the inclusion of any country that takes no emission abatement commitment. It can even make inefficient a country's decision to commit to an emission target.

Suggested Citation

  • BRECHET, Thierry & meniere, Yann & PICARD, Pierre M., 2012. "The clean development mechanism in a global carbon market," LIDAM Discussion Papers CORE 2012040, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    • Handle: RePEc:cor:louvco:2012040
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    References listed on IDEAS

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    Cited by:

    1. Thierry Bréchet & Carmen Camacho & Vladimir M. Veliov, 2012. "Adaptive Model-Predictive Climate Policies in a Multi-Country Setting," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00718659, HAL.
    2. Thomas Baudin & David de la Croix & Paula E. Gobbi, 2015. "Fertility and Childlessness in the United States," American Economic Review, American Economic Association, vol. 105(6), pages 1852-1882, June.
    3. Nora, Vladyslav & Uno, Hiroshi, 2014. "Saddle functions and robust sets of equilibria," Journal of Economic Theory, Elsevier, vol. 150(C), pages 866-877.
    4. Venkatachalam ANBUMOZHI, 2015. "Low Carbon Green Growth in Asia: What is the Scope for Regional Cooperation?," Working Papers DP-2015-29, Economic Research Institute for ASEAN and East Asia (ERIA).
    5. Jon Strand, 2019. "Combining Carbon Taxation and Offset Payments: A New Approach to Climate Policy in Low-Income Countries," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 74(3), pages 949-960, November.
    6. Thomas Baudin & David de La Croix & Paula Gobbi, 2012. "DINKs, DEWKs & Co. Marriage, Fertility and Childlessness in the United States," Working Papers hal-00993307, HAL.
    7. Sabine Aresin, 2015. "Reduced Allowability and the Allocation of Emission Abatement," Working Papers tax-mpg-rps-2015-12, Max Planck Institute for Tax Law and Public Finance.

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    More about this item

    Keywords

    clean development mechanism; climate policy; strategic interactions;
    All these keywords.

    JEL classification:

    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
    • F64 - International Economics - - Economic Impacts of Globalization - - - Environment
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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