Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/66120 
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dc.contributor.authorHeindl, Peteren
dc.date.accessioned2012-11-08-
dc.date.accessioned2012-11-08T16:16:48Z-
dc.date.available2012-11-08T16:16:48Z-
dc.date.issued2012-
dc.identifier.piurn:nbn:de:bsz:180-madoc-325894en
dc.identifier.urihttp://hdl.handle.net/10419/66120-
dc.description.abstractAs shown by R. Hahn [6], free allocation equal to the amount of permits a firm with market power uses in equilibrium, can prevent welfare losses. If the necessary amount of free allocation is not provided to the firm with market power, a second best solution is obtained where marginal abatement costs of regulated firms are not equated. In this paper, it is proposed that the government may change the economy wide emissions constraint (cap) as a response to market power, e.g. when free allocation cannot be adjusted. Changing the cap can lead to a situation where marginal abatement costs are equated in the presence of market power. Because changing the cap will lead to changes of social welfare, both effects must be balanced. It is shown that there exists a second best social optimum by balancing the positive effect of limiting market power and the negative effect of changing the cap.en
dc.language.isoengen
dc.publisher|aZentrum für Europäische Wirtschaftsforschung (ZEW) |cMannheimen
dc.relation.ispartofseries|aZEW Discussion Papers |x12-065en
dc.subject.jelQ53en
dc.subject.jelL12en
dc.subject.jelD21en
dc.subject.ddc330en
dc.subject.keywordTradeable Permitsen
dc.subject.keywordMarket Poweren
dc.subject.keywordEnvironmental Regulationen
dc.titleMitigating market power under tradeable permits-
dc.typeWorking Paperen
dc.identifier.ppn729457540en
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen
dc.identifier.repecRePEc:zbw:zewdip:12065en

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