A discrete time "resource allocation process" bearing on international negotiations relating to SO? transfrontier pollution between Finland, Russia and Estonia is formulated here as a sequence of solutions to successive non linear programs. A novel assumption concerning local information on...

This paper investigates the relation between the optimal amount of pollution permits issued by an environmental agency and the mechanisms used to trade these permits in the "secondary market". We show that when permits are traded using a quote-driven mechanism, the total amount of permits to be...