Long, Ngo Van; Soubeyran, Antoine - Centre Interuniversitaire de Recherche en Analyse des … - 1998
We show that when polluting firms are Cournot oligopolists, they may have an incentive to use the market of pollution permits as a means of indirectly coordinating their outputs. If firms are initially identical, trade in pollution permits may result in an asymmetric oligopoly. The case where...