Analysis on Trilateral Game of Government Agency, Emission-Dependent Firm and Carbon Verification Institutions under Cap-and-Trade Scheme

Mei Wen; Jun Zeng; Ming Qiu

doi:10.4028/www.scientific.net/AMR.1092-1093.1585

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HomeAdvanced Materials ResearchAdvanced Materials Research Vols. 1092-1093Analysis on Trilateral Game of Government Agency,...

Analysis on Trilateral Game of Government Agency, Emission-Dependent Firm and Carbon Verification Institutions under Cap-and-Trade Scheme

Abstract:

To reduce carbon emission, cap-and-trade (C&T) is regarded as one of the effective environmental regulations around the world, which brings huge challenges to generating firms. In this paper, a tripartite game model on carbon abatement is built to analyze their optimal strategies under the C&T scheme. Based on the equilibrium of the game, some suggestions are presented to give the government agency to promote the efficiency of C&T scheme, that is, introducing carbon verification institution and doing heavier fine to firm will decrease the probability of firm deception and relieve the burden of the government agency; setting reward to carbon verification institution and an appropriate increase in fine of carbon verification institution will decrease the probability of supervisor inspection, further saving supervision costs.

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Periodical:

Advanced Materials Research (Volumes 1092-1093)

Pages:

1585-1590

DOI:

https://doi.org/10.4028/www.scientific.net/AMR.1092-1093.1585

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Online since:

March 2015

Authors:

Mei Wen*, Jun Zeng, Ming Qiu

Keywords:

Cap-and-Trade, Carbon Emission, Tripartite Game Model

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