While reducing industrial greenhouse gas (GHG) emissions is undoubtedly necessary to avoid an ecological disaster, political support for environmental regulation depends largely on its effectiveness and expected side-effects. A potential fallout often associated with environmental policies is a...

In the absence of an international agreement on climate policy, unilateral carbon abatement creates two problems: It tends to have a detrimental effect on domestic competitiveness, and it leads to an increase in carbon emissions abroad (leakage). This paper analyses two policies that have...

In the absence of an international agreement on climate policy, unilateral carbon abatement creates two problems: It tends to have a detrimental effect on domestic competitiveness, and it leads to an increase in carbon emissions abroad (leakage). This paper analyses two policies that have...

Emissions trading is widely regarded as a cost-effective means of helping industrialized countries comply with their Kyoto emissions targets by ensuring that reductions in greenhouse gas emissions are made where they are least costly. If emissions trading among sub-national entities is...

A drastic decline in global greenhouse gas (GHG) emissions is needed to stop the climate change. This requires a variety of political and market mechanisms. Europe is globally at the forefront among the industrialised countries in reducing its GHG emissions. We analyse the development of...