Auctions are increasingly being used to allocate emissions allowances (“permits”) for cap and trade and common-pool resource management programs. These auctions create thick markets that can provide important information about changes in current market conditions. This paper reports a...

This classroom experiment introduces students to the concept of double marginalization, i.e., the exercise of market power at successive vertical layers in a supply chain. By taking on roles of firms, students determine how the mark-ups are set at each successive production stage. They learn...

The purpose of this study was to design an auction mechanism for use by the Regional Greenhouse Gas Initiative (RGGI) for selling emission allowances. We conducted a series of experiments to investigate the performance of a number of auction types considered to be likely candidates for use in a...