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The clean development mechanism in a global carbon market

Author

Listed:
  • BRECHET, Thierry

    (Université catholique de Louvain, CORE & LSM, Belgium)

  • meniere, Yann

    (Ecole des Mines de Paris, CERNA)

  • PICARD, Pierre M.

    (Université catholique de Louvain, CORE, Belgium; CREA, University of Luxembourg)

Abstract
This paper discusses the role of the Clean Development Mechanism (CDM) on the market for carbon quotas and countries' commitments to reduce their carbon emission levels. We show that the CDM contributes to an efficient funding of clean technology investments in least developed countries. However, the CDM is not neutral on the global level of carbon emissions as it entices countries to raise their emission caps. The CDM may also make inappropriate the inclusion of any country that takes no emission abatement commitment. It can even make inefficient a country's decision to commit to an emission target.

Suggested Citation

  • BRECHET, Thierry & meniere, Yann & PICARD, Pierre M., 2012. "The clean development mechanism in a global carbon market," LIDAM Discussion Papers CORE 2012040, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    • Handle: RePEc:cor:louvco:2012040
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    References listed on IDEAS

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    13. HAEDO, Christian & MOUCHART, Michel, 2012. "A stochastic independence approach for different measures of concentration and specialization," LIDAM Discussion Papers CORE 2012025, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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    Cited by:

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    2. Venkatachalam ANBUMOZHI, 2015. "Low Carbon Green Growth in Asia: What is the Scope for Regional Cooperation?," Working Papers DP-2015-29, Economic Research Institute for ASEAN and East Asia (ERIA).
    3. Thierry Bréchet & Carmen Camacho & Vladimir M. Veliov, 2012. "Adaptive Model-Predictive Climate Policies in a Multi-Country Setting," Documents de travail du Centre d'Economie de la Sorbonne 12029, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    4. Jon Strand, 2019. "Combining Carbon Taxation and Offset Payments: A New Approach to Climate Policy in Low-Income Countries," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 74(3), pages 949-960, November.
    5. Nora, Vladyslav & Uno, Hiroshi, 2014. "Saddle functions and robust sets of equilibria," Journal of Economic Theory, Elsevier, vol. 150(C), pages 866-877.
    6. Sabine Aresin, 2015. "Reduced Allowability and the Allocation of Emission Abatement," Working Papers tax-mpg-rps-2015-12, Max Planck Institute for Tax Law and Public Finance.
    7. Fabio Antoniou & Panos Hatzipanayotou & Nikos Tsakiris, 2021. "Strategic Export Motives and Linking Emission Markets," CESifo Working Paper Series 8847, CESifo.

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    More about this item

    Keywords

    clean development mechanism; climate policy; strategic interactions;
    All these keywords.

    JEL classification:

    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
    • F64 - International Economics - - Economic Impacts of Globalization - - - Environment
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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