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A General Equilibrium Approach to Carbon Permit Banking

Author

Listed:
  • : Dubois, Loick

    (University Paris-Dauphine)

  • Sahuc, Jean-Guillaume

    (Banque de France, University Paris-Nanterre)

  • Vermandel, Gauthier

    (Ecole Polytechnique, Palaiseau and University Paris-Dauphine)

Abstract

This paper studies the general equilibrium effects of carbon permit banking during the transition to a climate-neutral economy by 2050. The analysis highlights the critical role of permit banking in shaping the policy outcomes.

Suggested Citation

  • : Dubois, Loick & Sahuc, Jean-Guillaume & Vermandel, Gauthier, 2024. "A General Equilibrium Approach to Carbon Permit Banking," Single Market Economics Papers WP2024/20, Directorate-General for Internal Market, Industry, Entrepreneurship and SMEs (European Commission), Chief Economist Team.
    • Handle: RePEc:bda:wpsmep:wp2024/20
    DOI: 10.2873/924733
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    More about this item

    Keywords

    Emission trading systems; cap policies; carbon permit banking; environmental real business cycle model; occasionally-binding constraints; nonlinear estimation;
    All these keywords.

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • Q50 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - General
    • Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Adoption and Costs; Distributional Effects; Employment Effects
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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