Tradable Performance-Based CO_2 Emissions Standards: Walking on Thin Ice?

摘要

1. Allow for market power in both product and permits marketsto assess the impact of performance-based standards1.1 Cross-subsidy effect dominates under a relatively dirtyendowment for the leader: higher consumption, scarcer permits,and less incentive for leader to behave strategically in bothmarkets1.2 Market-power effect dominates under a relatively cleanendowment for the leader: more aggressive in extractingeconomic rent1.3 Higher permit price under Stackelberg game as opposed to aCournot duopoly2. Future work: states with heterogenous standards, stochasticmodel, more realistic test network.