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Implications of Search Frictions for Tradeable Permit Markets

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  • Rouhi-Rad, Mani
  • Brozovic, Nicholas
  • Mieno, Taro

Abstract

This study develops a framework of search with frictions in the context of tradeable permit markets to explain the trading behavior and search effort of the participants. The study area is the groundwater market of the Twin Platte Natural Resources District, in Nebraska. The results show that overall the market is moving towards Pareto efficiency as irrigation rights are moving from lower value users to higher value users. The results also suggest that quantity of the rights traded affects the search effort of the participants positively.

Suggested Citation

  • Rouhi-Rad, Mani & Brozovic, Nicholas & Mieno, Taro, 2015. "Implications of Search Frictions for Tradeable Permit Markets," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205798, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea15:205798
    DOI: 10.22004/ag.econ.205798
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    References listed on IDEAS

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    Environmental Economics and Policy; Resource /Energy Economics and Policy;

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