Economic, institutional and technological uncertainties of emissions trading-a system dynamics modeling approach

Irina Dolgopolova, Bo Hu*, Armin Leopold, Stefan Pickl

*Corresponding author for this work

Research output: Contribution to journalArticleAcademicpeer-review

1 Citation (Web of Science)

Abstract

System dynamics models are employed for analyzing the impact of different uncertainties on carbon emission trading–both on national and business levels. Economic, institutional and technological uncertainties significantly influence any country's benefits from emission permit trading. If a country participates in trading on the international market then the possible price range becomes the source of additional uncertainty. In the case of business investment decisions for implementing resource‐saving technology, our system dynamics model shows that the first‐mover investor will get significantly fewer advantages than his followers, which leads to delay in primary investment to the sector.
Original languageEnglish
Pages (from-to)663-676
Number of pages14
JournalClimatic Change
Volume124
Issue number3
DOIs
Publication statusPublished - Jun 2014
Externally publishedYes

Keywords

  • emission trading
  • business sector
  • System dynamic model
  • permit price
  • emission permit

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