S-WoPEc
 
Scandinavian Working Papers in Economics
HomeAboutSeriesSubject/JEL codesAdvanced Search
Department of Economics, Aarhus School of Business, University of Aarhus Working Papers, Department of Economics, Aarhus School of Business, University of Aarhus

No 02-16:
Lobbyism and CO2 trade in the EU

Gert Tinggaard Svendsen ()

Abstract: Has the EU Directive Proposal on CO2 trade been influenced by lobbyism and can it be improved? After hypothesizing how the EU may be vulnerable to lobbyism and why industrial groups have a strong incentive to lobby for favourable environmental regulation, we turn to empirical evidence concerning design. Here, it is possible to measure lobbyism as the difference in proposed design between the Green Paper (before lobbyism) and the final Directive Proposal (after lobbyism). Overall we suggest that this lobbyism affected the design of the EU CO2 market in favour of small-sized and well-organised industrial interest groups at the expense of the EU tax payers. Most critically, allocation of permits and enforcement issues are to be dealt with at the member state level rather than the supranational level allowing member states to favour their domestic industries. A likely market breakdown means less economic growth in the EU because the gains from free trade of greenhouse gas permits among firms in different member states disappear. Therefore, we discuss, based on the US emission trade experience, how the current design proposal can be improved.

Keywords: Lobbyism; CO2 trade; European Union; political economy; Kyoto protocol; burden sharing; grandfathering; auction; enforcement; (follow links to similar papers)

JEL-Codes: H20; H40; Q28; (follow links to similar papers)

16 pages, December 1, 2002

Before downloading any of the electronic versions below you should read our statement on copyright.
Download GhostScript for viewing Postscript files and the Acrobat Reader for viewing and printing pdf files.

Full text versions of the paper:

02-16_gts.pdf    PDF-file
Download Statistics

Questions (including download problems) about the papers in this series should be directed to Helle Vinbaek Stenholt ()
Report other problems with accessing this service to Sune Karlsson () or Helena Lundin ().

Programing by
Design by Joachim Ekebom

Handle: RePEc:hhs:aareco:2002_016 This page was generated on 2014-12-14 19:20:38