Detecting Impact of Allowance Trading Behaviors on Distribution of Nox Emission Reductions : Evidence from the Clean Air Interstate Rule (Cair)
Cap-and-trade has been promoted by economists due to its cost-effectiveness. However, cap-and-trade could also introduce the risk of environmental inequality by creating pollution concentrations in areas where emitting facilities purchase many allowances. To investigate this concern, I collect facility-year level NOx emissions and allowance transaction data from the Clean Air Interstate Rule (CAIR), a cap-and-trade program targeting on the power sector in the east US. Using a differences-in-differences with instrumental variable approach, I identify the causal effect of allowance purchase on emissions reduction. Results indicate that buyers under CAIR were even able to achieve about 30% of emissions reduction compared with non-participants. I therefore conclude that there is little evidence of environmental inequality from trading activities under CAIR
Year of publication: |
2023
|
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Authors: | Yang, Yuanxiaoyue |
Publisher: |
[S.l.] : SSRN |
Subject: | Luftreinhaltung | Air pollution control | Luftverschmutzung | Air pollution | Emissionshandel | Emissions trading | Treibhausgas-Emissionen | Greenhouse gas emissions | Wirkungsanalyse | Impact assessment |
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