This paper assesses the potential impact of the European Union Emissions Trading System (EU ETS) on firm productivity. We estimate a stylized version of the neo-Schumpeterian model, which incorporates innovation and productivity catch-up as two potential sources of firm’s productivity growth,...

The central pillar of European climate policy, the European Emissions Trading System (EU ETS), is currently under scrutiny, as the allowance price is persistently low at around 5€/tCO2. The cap was met and emissions actually declined in recent years, ensuring the environmental effectiveness of...

The first pillar of the old paradigm of carbon pricing is the assumption that an emissions trading scheme is the most cost-efficient way to achieve a certain emission reduction target. However, it has become obvious that the old paradigm is unable to solve a number of challenges, e.g. market...

A global crediting mechanism would enable developing countries without binding emissions reduction targets to participate in the international carbon market. Linking the framework on Reducing Emissions from Deforestation and Forest Degradation (REDD) as an offset program to major cap-and-trade...