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Governance of CO2 markets: lessons from the EU ETS

Author

Listed:
  • Christian De Perthuis

    (LEDa - Laboratoire d'Economie de Dauphine - Université Paris-Dauphine)

  • Raphaël Trotignon

    (Chaire Economie du climat - Université Paris-Dauphine)

Abstract

The economic literature differentiates “command and control” policies, in which the public authority sets up standards and rules to directly reduce environmental damage, from policies based on “economic tools” aiming at internalizing the cost of environmental damage. There is a broad consensus among economists in favour of economic tools that aim at protecting the environment in the most efficient way, i.e. by minimizing the total cost of pollution abatement. Despite those recommendations, most of the environmental policies implemented in the real world continue to favour command and control policies.

Suggested Citation

  • Christian De Perthuis & Raphaël Trotignon, 2013. "Governance of CO2 markets: lessons from the EU ETS," Post-Print hal-01504635, HAL.
    • Handle: RePEc:hal:journl:hal-01504635
    Note: View the original document on HAL open archive server: https://hal.archives-ouvertes.fr/hal-01504635
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    References listed on IDEAS

    as
    1. Park, Hojeong & Hong, Won Kyung, 2014. "Korea׳s emission trading scheme and policy design issues to achieve market-efficiency and abatement targets," Energy Policy, Elsevier, vol. 75(C), pages 73-83.
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    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. repec:eee:enepol:v:109:y:2017:i:c:p:835-844 is not listed on IDEAS
    2. Park, Hojeong & Hong, Won Kyung, 2014. "Korea׳s emission trading scheme and policy design issues to achieve market-efficiency and abatement targets," Energy Policy, Elsevier, vol. 75(C), pages 73-83.
    3. Zhao, Xin-gang & Jiang, Gui-wu & Nie, Dan & Chen, Hao, 2016. "How to improve the market efficiency of carbon trading: A perspective of China," Renewable and Sustainable Energy Reviews, Elsevier, vol. 59(C), pages 1229-1245.
    4. Jiang, M. & Liang, X. & Reiner, D. & Lin, B., 2018. "Stakeholder Views on Interactions between Low-carbon Policies and Carbon Markets in China: Lessons from the Guangdong ETS," Cambridge Working Papers in Economics 1811, Faculty of Economics, University of Cambridge.
    5. Simon Quemin, 2016. "Intertemporal abatement decisions under ambiguity aversion in a cap and trade," Working Papers 1604, Chaire Economie du climat.
    6. Raphaël Trotignon & Pierre-André Jouvet & Boris Solier & Simon Quemin & Jérémy Elbeze, 2015. "European carbon market: lessons on the impact of a market stability reserve using the Zephyr model," Working Papers 1511, Chaire Economie du climat.
    7. Simone Borghesi & Andrea Flori, 2016. "EU ETS Facets in the Net: How Account Types Influence the Structure of the System," Working Papers 2016.08, Fondazione Eni Enrico Mattei.
    8. Brouwers, Roel & Schoubben, Frederiek & Van Hulle, Cynthia & Van Uytbergen, Steve, 2016. "The initial impact of EU ETS verification events on stock prices," Energy Policy, Elsevier, vol. 94(C), pages 138-149.
    9. Xavier Timbeau & Pawel Wiejski, 2017. "EU ETS-broken beyond repair ? An analysis based on FASTER principles," Sciences Po publications 24, Sciences Po.
    10. Zhang, Cheng & Wang, Qunwei & Shi, Dan & Li, Pengfei & Cai, Wanhuan, 2016. "Scenario-based potential effects of carbon trading in China: An integrated approach," Applied Energy, Elsevier, vol. 182(C), pages 177-190.
    11. Kallabis, Thomas & Pape, Christian & Weber, Christoph, 2016. "The plunge in German electricity futures prices – Analysis using a parsimonious fundamental model," Energy Policy, Elsevier, vol. 95(C), pages 280-290.
    12. Gao, Shuai & Smits, Mattijs & Mol, Arthur P.J. & Wang, Can, 2016. "New market mechanism and its implication for carbon reduction in China," Energy Policy, Elsevier, vol. 98(C), pages 221-231.
    13. Baochen Yang & Chuanze Liu & Yunpeng Su & Xin Jing, 2017. "The Allocation of Carbon Intensity Reduction Target by 2020 among Industrial Sectors in China," Sustainability, MDPI, Open Access Journal, vol. 9(1), pages 1-19, January.
    14. Simon Quemin & Christian de Perthuis, 2017. "Transitional restricted linkage between Emissions Trading Schemes," Working Papers 1701, Chaire Economie du climat.
    15. Richstein, Jörn C. & Chappin, Émile J.L. & de Vries, Laurens J., 2015. "Adjusting the CO2 cap to subsidised RES generation: Can CO2 prices be decoupled from renewable policy?," Applied Energy, Elsevier, vol. 156(C), pages 693-702.

    More about this item

    Keywords

    Energy policy; European Union Emission Trading Scheme;

    JEL classification:

    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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