Antoniou, Fabio; Hatzipanayotou, Panos; Tsakiris, Nikos - In: Environmental and Resource Economics 87 (2024) 6, pp. 1407-1424
We construct a two-country trade model where emissions are an input in production and generate cross-border pollution. We examine the strategic incentives of an active regulator who sets a binding level of emissions in production. We show that, in the presence of terms of trade and emission...