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dc.contributor.authorAndersen, Jørgen Juel
dc.contributor.authorGreaker, Mads
dc.date.accessioned2014-12-18T14:22:32Z
dc.date.available2014-12-18T14:22:32Z
dc.date.issued2014
dc.identifier.issn1892-2198
dc.identifier.urihttp://hdl.handle.net/11250/227865
dc.description.abstractThe theoretical justification for a greenhouse gas (GHG) cap and trade system is that participants will trade emission permits until their marginal cost of abatement equals the equilibrium price of emission permits. However, for fiscally constrained governments this logic does not apply, as they have a fiscal incentive to let welfare concerns, rather than industrial cost efficiency, guide their abatement policy. Then, global cost efficiency will fail even if just a (small) subset of governments are fiscally constrained. Finally, we argue that any institutional change which breaks the connection between a government's abatement policy and its budget will increase welfare.nb_NO
dc.language.isoengnb_NO
dc.publisherBI Norwegian Business Schoolnb_NO
dc.subjectenvironmental policy, fiscal incentive, fiscal constraints, GHG cap and trade, welfarenb_NO
dc.titleThe fiscal incentive of GHG cap and trade: Permits may be too cheap and developed countries may abate too littlenb_NO
dc.typeWorking papernb_NO
dc.source.pagenumber28 pagesnb_NO


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