Banning banking in EU emissions trading?
Admitting banking in emissions trading systems reduces overall compliance costs by allowing for inter-temporal flexibility: cost savings can be traded over time. However, unless individual EU Member States (MS) decide differently, the transfer of unused allowances from the period of 2005-2007 into the first commitment period under the Kyoto Protocol, i.e. 2008�2012, will be prohib-ited. In this paper, we first explore the implications of such a ban on banking when initial emission targets are lenient. This analysis is based on a simulation which was recently carried out in Germany with companies and with a student control group. The findings suggest that an EU-wide ban on banking would lead to efficiency losses in addition to those losses which arise from the lack of inter-temporal flexibility. Second, we use simple game-theoretic considerations to argue that, under reasonable assumptions, such an EU-wide ban on banking will be the equilibrium outcome. Thus, to avoid a possible prisoners� dilemma, MS should co-ordinate their banking decisions.
To our knowledge, this item is not available for
download. To find whether it is available, there are three
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
|Date of creation:||03 Dec 2004|
|Date of revision:|
|Note:||Financial support from the Deutsche Forschungsgemeinschaft, SFB 504, at the University of Mannheim, is gratefully acknowledged.|
|Contact details of provider:|| Postal: |
Phone: (49) (0) 621-292-2547
Fax: (49) (0) 621-292-5594
Web page: http://www.sfb504.uni-mannheim.de/
More information through EDIRC
Web page: http://www.sfb504.uni-mannheim.de
|Order Information:|| Email: |
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Stuart Mestelman & Andrew Muller, 1997.
"What Have We Learned From Emissions Trading Experiments?,"
McMaster Experimental Economics Laboratory Publications
1997-03, McMaster University.
- R. Andrew Muller & Stuart Mestelman, 1998. "What have we learned from emissions trading experiments?," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 19(4-5), pages 225-238.
- Plott, Charles R., .
"Industrial Organization Theory and Experimental Economics,"
405, California Institute of Technology, Division of the Humanities and Social Sciences.
- Plott, Charles R, 1982. "Industrial Organization Theory and Experimental Economics," Journal of Economic Literature, American Economic Association, vol. 20(4), pages 1485-1527, December.
- Akhurst, Mark & Morgheim, Jeff & Lewis, Rachel, 2003. "Greenhouse gas emissions trading in BP," Energy Policy, Elsevier, vol. 31(7), pages 657-663, June.
- Editors, 2003. "Editor's Introduction," American Journal of Economics and Sociology, Wiley Blackwell, vol. 62(2), pages 315-318, 04.
- Kling, Catherine & Rubin, Jonathan, 1997.
"Bankable permits for the control of environmental pollution,"
Journal of Public Economics,
Elsevier, vol. 64(1), pages 101-115, April.
- Kling, Catherine L. & Rubin, Jonathan, 1997. "Bankable Permits for the Control of Environmental Pollution," Staff General Research Papers 1479, Iowa State University, Department of Economics.
- R. Andrew Muller, 1999. "Experimental Methods for Research into Trading of Greenhouse Gas Emissions," Department of Economics Working Papers 1999-14, McMaster University.
- Newell, Richard G & Stavins, Robert N, 2003.
"Cost Heterogeneity and the Potential Savings from Market-Based Policies,"
Journal of Regulatory Economics,
Springer, vol. 23(1), pages 43-59, January.
- Stavins, Robert & Newell, Richard, 2000. "Cost Heterogeneity and the Potential Savings from Market-Based Policies," Discussion Papers dp-00-10-rev, Resources For the Future.
- Montgomery, W. David, 1972. "Markets in licenses and efficient pollution control programs," Journal of Economic Theory, Elsevier, vol. 5(3), pages 395-418, December.
- repec:cup:cbooks:9780521660839 is not listed on IDEAS
- Loewenstein, George, 1999. "Experimental Economics from the Vantage-Point of Behavioural Economics," Economic Journal, Royal Economic Society, vol. 109(453), pages F23-34, February.
- Boemare, Catherine & Quirion, Philippe, 2002.
"Implementing greenhouse gas trading in Europe: lessons from economic literature and international experiences,"
Elsevier, vol. 43(2-3), pages 213-230, December.
- Catherine Boemare & Philippe Quirion, 2002. "Implementing greenhouse gas trading in Europe: lessons from economic literature and international experiences," Post-Print halshs-00007264, HAL.
- Editors, 2003. "Editor's Introduction," American Journal of Economics and Sociology, Wiley Blackwell, vol. 62(4), pages 645-648, October.
- Juan-Pablo Montero, 2002.
"The Temporal Efficiency of SO2 Emissions Trading,"
Documentos de Trabajo
225, Instituto de Economia. Pontificia Universidad Católica de Chile..
When requesting a correction, please mention this item's handle: RePEc:xrs:sfbmaa:04-60. 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: (Carsten Schmidt)The email address of this maintainer does not seem to be valid anymore. Please ask Carsten Schmidt to update the entry or send us the correct address
If references are entirely missing, you can add them using this form.