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on Resource Economics |
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Issue of 2006‒10‒21
two papers chosen by |
| By: | Hennlock, Magnus (Department of Economics, School of Business, Economics and Law, Göteborg University) |
| Abstract: | The recent approach ‘subgame consistency’ in cooperative stochastic differential games by Yeung and Petrosjan (2006) and Yeung and Petrosjan (2004) is applied to the classical Coase theorem in the presence of stochastic stock externalities. The dynamic Coasean bargaining solution is identified involving a negotiated plan of externality trade over time as well as subgame consistent Coasean liability payments flow under different assignments of property rights. The agent with the right to determine the externality has the advantage to choose his own private equilibrium as the initial condition in the dynamic system of the Coasean bargaining solution. The dynamic Coasean bargaining solution is formulated followed by an illustration showing an analytical tractable solution. <p> |
| Keywords: | dynamic cooperative games; cooperative stochastic differential games; dynamic stability; Coase theorem |
| JEL: | C71 C73 Q53 Q56 |
| Date: | 2006–09–26 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0229&r=res |
| By: | Golombek, Rolf (The Ragnar Frisch Centre for Economic Research); Hoel, Michael (Dept. of Economics, University of Oslo) |
| Abstract: | The Kyoto Agreement is the result of international negotiations over many years. However, because of a number of weaknesses, different sorts of climate agreement have been suggested: for example, coordinated R&D activities that reduce abatement costs for all firms. We will compare an agreement focusing only on emissions (a Kyoto type of agreement) with an agreement focusing only on technology, assuming that the costs of abatement are affected by R&D in all firms through technology spillovers. In an emissions agreement, emissions should be restricted to the extent that the carbon price exceeds the Pigovian level. For sufficiently low technology spillovers, an emissions agreement is more efficient than a technology agreement specifying an R&D subsidy to be imposed on all firms in all countries. The opposite may hold if technology spillovers are sufficiently large. Finally, an alternative technology agreement specifying R&D expenditure in each country is more efficient than an agreement specifying an R&D subsidy. |
| Keywords: | climate policy; international climate agreements; R&D policy; technology spillovers |
| JEL: | H23 O30 Q20 Q28 Q48 |
| Date: | 2006–09–29 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:osloec:2006_021&r=res |