Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/322927 
Year of Publication: 
2015
Series/Report no.: 
U.S.E. Discussion Papers Series No. 15-01
Publisher: 
Utrecht University, Utrecht School of Economics, Tjalling C. Koopmans Research Institute, Utrecht
Abstract: 
To reach an international agreement on the cost of abatement of climate change, one needs to specify a fair burden sharing rule. This paper evaluates different burden sharing rules in terms of their redistributive impact and by the extent to which they realize the aim of optimal abatement. It is shown that for all regions and almost all countries, the Lindahl solution, where the burden sharing rule of carbon abatement is determined by each country's willingness to pay, is to be preferred above the noncooperative Nash outcome. Poor countries and regions however would prefer the social planner outcome with a global permit market, because then the burden sharing rule is given a secondary role of income redistribution from rich to poor, on top of its primary role of assigning abatement burdens.
Subjects: 
Nash
Lindahl
tradable permits
equity
efficiency
burden sharing rule
Document Type: 
Working Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.