We investigate how moral concerns about permit trading affect an endogenous pollution permit trading equilibrium, where governments choose non-cooperatively the amount of permits they allocate to domestic industries. Politicians may feel reluctant to allow permit trading and/or may prefer that...

Strategic market behavior by permit sellers will harm the European Union as the EU as a whole is expected to become a large net buyer of permits in a follow-up agreement to the Kyoto Protocol. In this paper we explore how the EU could benefit from making permit trade agreements with non-EU...

We analyze stability of self-enforcing climate agreements based on a data set generated by the CLIMNEG world simulation model (CWSM), version 1.2. We consider two new aspects which appear important in actual treaty-making. First, we consider a sequential coalition formation process where players...