We address the issue of emission tax harmonization in a model featuring two representative firms located in two countries. Firms are subject to an international emissions trading system and to domestic emissions taxation; the latter generates public revenue but also implies implementation costs....

We model an environmental policy problem with two representative firms in two countries (one for each country). Firms are subject to environmental taxation, aimed at reducing CO2 emissions, and a unilateral technological spillover takes place: one of the two countries (innovating country) is...