This study develops a theoretical general equilibrium model to examine optimal externality tax policy in the presence of externalities linked to one another through markets rather than technical production relationships. Analytical results reveal that the second-best externality tax rate may be...

This study develops a theoretical general equilibrium model to examine optimal externality tax policy in the presence of externalities linked to one another through markets rather than technical production relationships. Analytical results reveal that the second-best externality tax rate may be...

Carbon dioxide (CO2) emissions impose a significant cost on society by contributing to climate change. The electricity sector is a major source of these emissions, yet their external cost is not fully reflected in electricity rates, and the market outcomes thus do not adjust to reflect those...

As a consequence of the missing global agreement in the fight against Climate Change, several independent emissions trading schemes are coming into operation. From an economic perspective it would be desirable if prices of CO2 emission allowances were the same in each scheme, as this would...

Objective - The purpose of this study is to provide the argument that carbon disclosure must not only provide economic but also non-economic information. The more comprehensive disclosure of carbon emission is expected to change the behavior of industries in realizing a more environmentally...

Agriculture accounts for 13 percent of global GHG emissions. This rises to approximately 30 percent if land clearance for farming, agrochemical production and trade in agricultural and food products are attributed to the sector. Market based mechanisms (carbon tax, cap and trade, payment for...

This paper proposes a fixed price auction mechanism to overcome asymmetric information problem considering firms with heterogeneous emission abatement costs. When facing fixed price permit auction and emission trading market, firms will make trade-offs between buying permits at fixed price and...

We examine the association between carbon risk and future stock price crash risk and the moderating role of climate change disclosures in this association using a sample of firms across the world. We find that carbon risk is positively associated with future stock price crash risk, and...

Carbon leakage is one of the major issues facing policymakers today when designing environmental regulation. While the empirical and trade literature on carbon leakage is rich, much less is known about the implications of carbon leakage risk on optimal regulatory policies under asymmetric...

Biased beliefs affect real-world decisions, including political solutions to societal challenges. One crucial example is environmental policy: people tend to underestimate the incentive effect of Pigouvian policies. Addressing biased beliefs at scale is then paramount. In the days leading up to...