Testing the efficiency of a tradeable permits market
A tradeable permits market is said to be efficient when all affected firms trade permits until their marginal costs equal the market price. Detailed firm-level data are generally required to perform such an efficiency test, yet such information is rarely available. If firms face a declining target,...
| Main Author: | |
|---|---|
| Other Authors: | |
| Format: | Working Paper |
| Published: |
MIT Center for Energy and Environmental Policy Research
2009
|
| Online Access: | http://hdl.handle.net/1721.1/44985 |
| _version_ | 1826193698942091264 |
|---|---|
| author | Montero, Juan-Pablo |
| author2 | Massachusetts Institute of Technology. Center for Energy and Environmental Policy Research. |
| author_facet | Massachusetts Institute of Technology. Center for Energy and Environmental Policy Research. Montero, Juan-Pablo |
| author_sort | Montero, Juan-Pablo |
| collection | MIT |
| description | A tradeable permits market is said to be efficient when all affected firms trade permits until their marginal costs equal the market price. Detailed firm-level data are generally required to perform such an efficiency test, yet such information is rarely available. If firms face a declining target, however, and are allowed to bank permits, as has occured recently, aggregated data such as the evolution of the permits bank is sufficient to test for either less than optimal market participation or the exercise of market power. An application to the U.S. sulfur dioxide emission permits market is provided. |
| first_indexed | 2024-09-23T09:43:16Z |
| format | Working Paper |
| id | mit-1721.1/44985 |
| institution | Massachusetts Institute of Technology |
| last_indexed | 2024-09-23T09:43:16Z |
| publishDate | 2009 |
| publisher | MIT Center for Energy and Environmental Policy Research |
| record_format | dspace |
| spelling | mit-1721.1/449852019-04-10T11:14:31Z Testing the efficiency of a tradeable permits market Montero, Juan-Pablo Massachusetts Institute of Technology. Center for Energy and Environmental Policy Research. A tradeable permits market is said to be efficient when all affected firms trade permits until their marginal costs equal the market price. Detailed firm-level data are generally required to perform such an efficiency test, yet such information is rarely available. If firms face a declining target, however, and are allowed to bank permits, as has occured recently, aggregated data such as the evolution of the permits bank is sufficient to test for either less than optimal market participation or the exercise of market power. An application to the U.S. sulfur dioxide emission permits market is provided. Supported by the MIT Center for Energy and Environmental Policy Research. 2009-04-03T17:05:02Z 2009-04-03T17:05:02Z 2002 Working Paper 2002-004 http://hdl.handle.net/1721.1/44985 52304726 MIT-CEEPR (Series) ; 02-004WP. 33 p application/pdf MIT Center for Energy and Environmental Policy Research |
| spellingShingle | Montero, Juan-Pablo Testing the efficiency of a tradeable permits market |
| title | Testing the efficiency of a tradeable permits market |
| title_full | Testing the efficiency of a tradeable permits market |
| title_fullStr | Testing the efficiency of a tradeable permits market |
| title_full_unstemmed | Testing the efficiency of a tradeable permits market |
| title_short | Testing the efficiency of a tradeable permits market |
| title_sort | testing the efficiency of a tradeable permits market |
| url | http://hdl.handle.net/1721.1/44985 |
| work_keys_str_mv | AT monterojuanpablo testingtheefficiencyofatradeablepermitsmarket |