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dc.contributor.authorAbrell, J.
dc.contributor.authorRausch, S.
dc.date.accessioned2017-10-06T19:20:40Z
dc.date.available2017-10-06T19:20:40Z
dc.date.issued2016-07
dc.identifier.urihttp://hdl.handle.net/1721.1/111801
dc.description.abstractThis paper analyzes hybrid emissions trading systems (ETS) under partitioned environmental regulation when firms’ abatement costs and future emissions are uncertain. We show that hybrid policies that introduce bounds on the price or the quantity of abatement provide a way to hedge against differences in marginal abatement costs across partitions. Price bounds are more efficient than abatement bounds as they also use information on firms’ abatement technologies while abatement bounds can only address emissions uncertainty. Using a numerical stochastic optimization model with equilibrium constraints for the European carbon market, we find that introducing hybrid policies in EU ETS reduces expected excess abatement costs of achieving targeted emissions reductions under EU climate policy by up to 89 percent. We also find that under partitioned regulation there is a high likelihood for hybrid policies to yield sizeable ex-post cost reductions.en_US
dc.language.isoen_USen_US
dc.publisherMIT Joint Program on the Science and Policy of Global Changeen_US
dc.relation.ispartofseriesMIT Joint Program Report Series;301
dc.titleCombining Price and Quantity Controls under Partitioned Environmental Regulationen_US
dc.typeWorking Paperen_US
dc.identifier.citationReport 301en_US


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