Trading Toward a Stable Climate
26 Pages Posted: 12 Oct 2000
This paper is the introduction to a book on global climate trading edited by Suzi Kerr and shortly to be published by Edward Elgar. The book presents an integrated discussion of the practical, economic and political issues involved in the implementation of Annex I trading, that is, trading of greenhouse gas emissions among industrialized countries under the Kyoto Protocol to the Framework Convention on Climate Change. We discuss compliance with the Protocol as a whole and compliance under trading (with special emphasis on the issue of liability), administrative issues such as tracking the trade of permits, economic issues such as market power and effects on fair competition in goods, and political issues such as supplementarity, and hot air. We discuss the interaction between Joint Implementation and Annex I trading and some options for interacting domestic regulations with international trading. The book was produced jointly with the Center for Clean Air Policy and has grown out of direct work with key Annex I delegates and representatives of the business community. Thus it reflects and responds to their concerns and also their assessment of political and practical feasibility of different options. While several authors have contributed to the volume, all the papers have been developed together and discussed as a team. Thus the volume is more than a series of related papers. The papers are consistent with each other and draw on each other's insights.
We aim to focus future debate on issues where there are real conflicts of interests or genuine uncertainty about the appropriate design of instruments rather than continuing a debate muddied by misunderstanding and miscommunication. We hope to stimulate debate on the solutions proposed and stimulate research in areas where recommendations are ambiguous.
JEL Classification: F0, K2, Q3, L1
Suggested Citation: Suggested Citation