Elements of emission market design: An experimental analysis of California's market for greenhouse gas allowances

Authors: Charles Holt, William Shobe, Thaddeus Huetteman

We use a set of economic experiments to test the effects of some novel features of California’s new controls on greenhouse gas emissions. The California cap and trade scheme imposes limits on allowance ownership, uses a tiered price containment reserve sale, and settles allowance auctions based on the lowest accepted bid.

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