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Class notes

Environmental Economics; Tradable Permits

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The lecture notes cover the following: 1. How do tradable permit systems work in theory and in the real world? 2. What happens under a tradable permit system?

Institution
University Of Alberta (UofA)
Course
Econ 467 (ECON467)











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Institution
University of Alberta (UofA)
Study
Business Economics
Course
Econ 467 (ECON467)
All documents for this subject (6)

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Uploaded on
November 8, 2022
Number of pages
79
Written in
2021/2022
Type
Class notes
Professor(s)
Dana andersen
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Lecture 06
Tradable Permits

Dana Andersen
ECON 467

,Roadmap
1. How do tradable permit systems work in theory and in the real world?
2. What happens under a tradable permit system?

,Tradable permits

, Tradable permits

How do tradable permit systems work?1

First, recall a regular emission standard: we set Ē at the point where MAC =
MD

This is easy with one firm, but what if we have several, or hundreds?




1 Tradable permit systems are also called cap and trade systems.
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