{"title":"Domestic versus international emissions trading with capital mobility","authors":"Haitao Cheng","doi":"10.1016/j.reseneeco.2024.101433","DOIUrl":null,"url":null,"abstract":"<div><p>We employ the footloose capital model to examine and compare how two countries decide on their emission permits non-cooperatively under domestic and international emissions trading in the presence of capital mobility. We find that even if two countries are symmetric and have the same carbon prices under domestic emissions trading, they can benefit from international emissions trading. This finding holds regardless of capital mobility. We also find that allowing footloose capital increases each country’s and global emissions under domestic emissions trading; however, it does not affect emissions under international emissions trading. Additionally, we show that the cooperative choices of emission permits are the same regardless of international mobility of emission permits and capital and are always lower than the non-cooperative ones.</p></div>","PeriodicalId":47952,"journal":{"name":"Resource and Energy Economics","volume":"77 ","pages":"Article 101433"},"PeriodicalIF":2.6000,"publicationDate":"2024-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://www.sciencedirect.com/science/article/pii/S0928765524000095/pdfft?md5=1c341b18aa44253284cb27e5cc917433&pid=1-s2.0-S0928765524000095-main.pdf","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Resource and Energy Economics","FirstCategoryId":"96","ListUrlMain":"https://www.sciencedirect.com/science/article/pii/S0928765524000095","RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"ECONOMICS","Score":null,"Total":0}
引用次数: 0
Abstract
We employ the footloose capital model to examine and compare how two countries decide on their emission permits non-cooperatively under domestic and international emissions trading in the presence of capital mobility. We find that even if two countries are symmetric and have the same carbon prices under domestic emissions trading, they can benefit from international emissions trading. This finding holds regardless of capital mobility. We also find that allowing footloose capital increases each country’s and global emissions under domestic emissions trading; however, it does not affect emissions under international emissions trading. Additionally, we show that the cooperative choices of emission permits are the same regardless of international mobility of emission permits and capital and are always lower than the non-cooperative ones.
期刊介绍:
Resource and Energy Economics provides a forum for high level economic analysis of utilization and development of the earth natural resources. The subject matter encompasses questions of optimal production and consumption affecting energy, minerals, land, air and water, and includes analysis of firm and industry behavior, environmental issues and public policies. Implications for both developed and developing countries are of concern. The journal publishes high quality papers for an international audience. Innovative energy, resource and environmental analyses, including theoretical models and empirical studies are appropriate for publication in Resource and Energy Economics.