Equilibrium with a Market of Permits
In this paper we present the main results of three original studies on the equilibrium with a market of tradeable permits in a static framework. In first study, we have considered an international equilibrium of two countries which depend on the quantity of permits to each country. The allocation is efficient if and only if it is proportional to efficient labor. A redistribution in favor of the less developed country implies a redistribution to this country but leads to a dilemma with efficiency. In the second study, we analyze the consequences of the choice between giving free permits to firms and other possibilities. We show that for equalizing incomes of production factors with there marginal productivities, each factor should receive a quantity of free permits proportional to its contribution to production. In the third study, we consider the partial equilibrium of an industry where each firm is characterized by a parameter combining production efficiency and pollution effect. We define a theoretical indicator of environmental efficiency and we analyze its properties.
|Date of creation:||Jun 2004|
|Date of revision:|
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CORE Discussion Papers
1997041, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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"A theoretical measure of environmental efficiency,"
THEMA Working Papers
2003-21, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
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- Tetsuo Ono, 2002.
"The Effects of Emission Permits on Growth and the Environment,"
Environmental & Resource Economics,
European Association of Environmental and Resource Economists, vol. 21(1), pages 75-87, January.
- Ono, Tetsuo, 2001. "The Effects of Emission Permits on Growth and the Environment," Discussion Paper 33, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University.
- Fare, Rolf, et al, 1989. "Multilateral Productivity Comparisons When Some Outputs Are Undesirable: A Nonparametric Approach," The Review of Economics and Statistics, MIT Press, vol. 71(1), pages 90-98, February.
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