@techreport{Bohringer2006Sale,
abstract = {Since January 1st the European Union has launched an EU-internal emissions trading
scheme (EU ETS) for emission-intensive installations as the central pillar to comply with
the Kyoto Protocol. The EU ETS may be linked at some time to a Kyoto emissions
market where greenhouse gas emission allowances of signatory Kyoto countries can be
traded. In this paper we investigate the implications of Russian market power for
environmental effectiveness and regional compliance costs to the Kyoto Protocol taking
into account potential linkages between the Kyoto emissions market and the EU ETS. We
find that Russia may have incentives to join the EU ETS as long as the latter remains
separated from the Kyoto international emissions market. In this case, Russia can exert
monopolistic price discrimination between two separated markets thereby maximizing
revenues from hot air sales. The EU will be able to substantially reduce compliance costs
when it does not restrain itself to EU-internal emission regulation schemes. However, part
of the gains from extra-EU emissions trading will come at the expense of environmental
effectiveness as (more) hot air will be drawn in.},
address = {Mannheim},
author = {Christoph B\"{o}hringer and Ulf Moslener and Bodo Sturm},
copyright = {http://www.econstor.eu/dspace/Nutzungsbedingungen},
keywords = {Q25; D42; 330; market power; hot air; climate policy; Klimaschutz; Emissionshandel; Emissionsrechte; EU-Europ\"{a}isch; Marktmacht; Russland},
language = {eng},
number = {06-16},
publisher = {Zentrum f\"{u}r Europ\"{a}ische Wirtschaftsforschung (ZEW)},
title = {Hot Air for Sale: A Quantitative Assessment of Russia's Near-Term Climate Policy Options},
type = {ZEW Discussion Papers},
url = {http://hdl.handle.net/10419/24208},
year = {2006}
}
