This paper discusses coalition formation with side payments in markets for transferable property rights where strategic agents prevail on both sides of the market. Our concern is emissions permit trading under the Kyoto Protocol. While a seller cartel is not profitable, our analysis indicates...

Considered here is decentralized exchange of privately owned commodity bundles. Voluntary transactions take the form of repeated bilateral barters. Under broad and reasonable hypotheses the resulting process converges to comepetitive equilibrium. Price-taking behavior is not assumed. Prices...

This paper examines three compliance mechanisms of the Kyoto Protocol: (i) the restoration rate, (ii) the commitment period reserve rule, and (iii) the suspension mechanism, all potentially constraining greenhouse gas emissions trading across time and space. The joint effect of these mechanisms...

Abstract: Motivated by the climate problem, this paper examines some effects of international cap & trade when national quotas result from strategic choice. In contrast to the fairly optimistic tone of closely related literature, the tenor of our results is pessimistic. We find that though an...

The Kyoto Protocol foresees emission trading but does not yet specify verification of (uncertain) emissions. This paper analyses a setting in which parties can meet their emission targets by reducing emissions, by investing in monitoring (reducing uncertainty of emissions) or by (bilaterally)...

Abstract: Motivated by the climate problem, this paper examines some effects of international cap & trade when national quotas result from strategic choice. In contrast to the fairly optimistic tone of closely related literature, the tenor of our results is pessimistic. We find that though an...