GTAP Resources: Resource Display
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"A Stochastic Dynamic Game of Carbon Emissions Trading" by Haurie, Alain and Laurent Viguier Abstract This paper proposes a computable stochastic equilibrium model to represent the possible competition between Russia and China on the international market of carbon emissions permits. The model includes a representation of the uncertainty concerning the date of entry of developing countries (e.g. China) on this market in the form of an event tree. Assuming that this date of entry is an uncontrolled event, we model the competition as a dynamic game played on an event tree and we look for a solution called S-adapted equilibrium. We compare the solution obtained from realistic data describing the demand curves for permits and the marginal abatement cost curves in different countries, under different market and information structures: (i) Russia’s monopoly, (ii) Russia-China competition in a deterministic framework, (iii) Russia-China competition in a stochastic framework. The results show the possible impact of this competition on the pricing of emissions permits and on the ectiveness of Kyoto and post-Kyoto agreements, without a US participation. |
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- Dynamic modeling |
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Public Access  A Stochastic Dynamic Game of Carbon Emissions Trading (286.0 KB) Replicated: 0 time(s)Restricted Access No documents have been attached. Special Instructions No instructions have been specified. |
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Last Modified: 3/16/2026 10:39:15 AM
