We model a non-cooperative energy tax setting game amongst countries who join an international market in which firms trade emission permits. Countries can auction a share of their permit endowment and issue the remainder for free to a representative firm. Each country's regulator has a double...

International markets for tradable emission permits (TEP) co-exist with national energy taxation. A firm trading emission permits in the international market also pays energy taxes in its host country, thus creating an interaction between the international TEP-market and national energy taxes....

In a dynamic general equilibrium setup, this paper highlights the role of vintages and creative destruction in business fluctuations. By stressing the forward-looking characteristic of the optimal scrapping rule, we use a standard rational expectations argument to show the constancy of the...

In this paper we study the short term price behavior of December 2008 future prices for EU emission allowances. We model returns and volatility dynamics of this price showing that a standard ARMA-GARCH framework is not adequate and that the gaussianity assumption is rejected due to the...

In a Computable General Equilibrium (CGE) setting, we show how the cost of a carbon policy for an open economy depends on the assumptions made about future exogenous structural changes. For dynamic CGE models, we propose an analytical framework derived from static CGE models and associate...

The persistent uncertainty about mid-century CO2 emissions targets is likely to affect not only the technological choices that energy-producing firms will make in the future but also their current invest- ment decisions. We illustrate this effect on CO2 price and global energy transition within...

The competitive equilibrium correspondence, which associates equilibrium prices of commodities ans assets with allocations of endowments, identifies the preferences and beliefs of individuals, this is the case even if the asset market is incomplete.

We investigate the impact of changes in international trade and domestic transport costs on the internal geography of a domestic economy linked to the rest of the World through a hub. We address that issue by developing two three regions model, namely a version of the Footlose Entrepreneur and a...

We develop an economic geography model in which mobile skilled workers choose between working in the production sector or becoming part of an unproductive political elite. The elite sets tax rates on skilled and unskilled workers to maximize its own welfare by extracting rents, thereby...