Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/171540
Authors: 
Gersbach, Hans
Winkler, Ralph
Year of Publication: 
2008
Series/Report no.: 
Economics Working Paper Series 08/97
Abstract: 
We propose a blueprint for an international emission permit market such as the EU trading scheme. Each country decides on the amount of permits it wants to offer. A fraction of these permits is grandfathered, the remainder is auctioned. Revenues from the auction are collected in a global fund and reimbursed to member countries in fixed proportions. We show that international permit markets with refunding lead to outcomes in which all countries tighten the issuance of permits and are better off compared to standard international permit markets. If the share of grandfathered permits is sufficiently small, we obtain approximately socially optimal emission reductions.
Subjects: 
climate change mitigation
global refunding scheme
international permit markets
international agreements
tradeable permits
JEL: 
H23
Q54
H41
Persistent Identifier of the first edition: 
Document Type: 
Working Paper
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