A small open economy produces a consumer good, green and black energy, and imports fossil fuel at an uncertain price. Unregulated competitive markets are shown to be inefficient. The implied market failures are due to the agents' attitudes toward risk, to risk shifting and the uniform price for...

We study the incidence of carbon-reduction and green-energy promotion policies in an open fossil-fuel importing general equilibrium economy. The focus is on mixed price-based or quantity-based policies. Instruments directed toward promoting green energy are shown to reduce also carbon emissions...

We investigate the displacement effects of phase-out-of-coal policies in a stylized model of electricity generation and CO2 regulation, in which a group of countries operates an emissions trading scheme (ETS). Electricity markets are either international or national and the emissions cap remains...

We investigate the formation of global climate agreements (= stable grand climate coalitions) in a model, in which climate policy takes the form of carbon emission taxation and fossil fuel and consumption goods are traded on world markets. We expand the model of Eichner and Pethig (2014) by...

The basic model of the literature on self-enforcing international environmental agreements is a model of autarkic countries. We extend that model by international trade and investigate its impact on the performance of "Nash" coalitions and on their stability, in particular, in a general...