Climate | Article
Getting married (and divorced) : a critical review of the literature on (de)linking emissions trading schemes
29 September 2020
BY: Simone Borghesi, ZHU Tong
Strategic behavior and the environment, 2020, Vol. 8, No. 3, pp. 219-267
Carbon pricing in general and emissions trading in particular are gaining momentum at the world level. In recent years increasing attention has been devoted to the possibility of linking Emissions Trading Schemes (ETSs). The purpose of the present paper is to critically discuss the main findings emerging from the theoretical economic literature on linking and to draw lessons from the practical experiences of linking (and delinking). Both theoretical and empirical studies suggest that linking ETSs implies strategic interaction and requires substantial coordination between participants. Based on the theoretical literature and on the (un)successful attempts of linking existing ETSs, the present paper provides policy insights into the opportunity of linking in the real world, highlighting the similarity between linking/delinking and getting married/divorced.
logo cadmus Read it on Cadmus Download in open access

LATEST FSR PUBLICATIONS

Technical Report
India has embarked on an ambitious sustainable development pathway by applying a multipronged approach spanning several sectors from developing smart cities to enabling electric vehicles. In the power sector, it [...]
Technical Report
To increase the share of RES-E, governments have designed and implemented promotional policies which provide direct and indirect financial aid to RES-E adapters and developers. These promotional policies include several [...]
Other
About 1,100 TWh of natural gas can be stored in 115 storage facilities in 19 countries in the EU27 area, accounting for 25-30% of European consumption in winter periods. Securing [...]
Other
The outbreak of the Russia-Ukraine war has revived discussions on the EU’s dependence on fossil fuel imports from Russia. To ensure gas diversification, the EU Commission has suggested over a [...]
Other
The recent surge in energy prices has prompted many governments to introduce emergency measures to reduce the impact on consumers’ electricity and gas bills. In its REPowerEU Communication of 8 [...]
Other
Different measures for carbon leakage prevention across Emissions Trading Systems (ETSs) may distort economic competition between firms. The same is true of competition between jurisdictions if decisions on the location [...]

Join our community

To meet, discuss and learn in the channel that suits you best.

scroll

top