off floor trading disintegration and the bid ask spread in experimental markets this article uses experimental methods to establish that greater uncertainty in the environment increases the naturally emerging bid ask spread in double auction trading the opportunity to trade off floor is then introduced off floor trading is greater in the environment with a wider bid ask spread increases with block trading and increases still more with increasing subject experience finally the authors find that the preponderance of off floor trades are inside the bid ask spread supporting the hypothesis that a motive for such trades is to split privately the gain represented by the bid ask spread without revealing publicly a willingness to make price concessions coauthors are shawn lamaster vernon l smith and mark van boening copyright 1991 by university of chicago press

inducing liquidity in thin financial markets through combined value trading mechanisms asset pricing theory hypothesizes that investors are only interested in portfolios individual securities are evaluated only in terms of their contribution to portfolio risk and return yet standard financial market design is that of parallel unconnected markets whereby investors cannot submit orders in one market conditional on events in others when markets are thin this exposes them to substantial execution risk fear of ending up with unbalanced portfolios after trading may even keep investors from submitting orders further eroding liquidity and the ability of markets to equilibrate the suggested solution is a portfolio trading mechanism referred to as combined value trading cvt investors are allowed to submit orders for packages of securities and the system matches trades and computes prices by optimally combining portfolio orders in an open book we study the performance of the cvt mechanism experimentally and compare it to the performance of parallel unconnected double auctions in experiments with similar parametrization and either a similar number of subjects or substantially thicker markets we present evidence that our portfolio trading mechanism facilitates equilibration to the extent that the thicker markets do inspection of order submission and trade activity reveals that subjects manage to exploit the direct linkages between markets enabled by the cvt system

the price of pollution a dual approach to valuing so2 allowances under the 1990 clean air act amendments a market based scheme to reduce u s sulfur dioxide emissions takes effect in 1995 indications are that participation in the market will be light and allowance prices will be lower than was once expected using an output distance function approach for wisconsin coal burning utility plants we estimate the shadow price of so2abatement which should approximate the allowance price the estimated average shadow price is above the prices at which the few observed allowance trades have occurred wisconsin s stringent state so2legislation may explain a portion of this divergence

renewable energy expansion in the chilean power market a dynamic general equilibrium modeling approach to determine co2 emission baselines abstract over the last decade a high dependency on carbon intensive fuels in the chilean power sector has led to environmental concerns particularly regarding rapid growth in co2 emissions more recently the power sector has experienced significant structural changes with a rapid expansion of renewables in the energy matrix and this trend is expected to cause significant variations in future co2 emission baseline scenarios to investigate the economy wide impact of renewable energy expansions in chile s energy mix this research based on a computable general equilibrium cge model examines different co2 emission baseline scenarios however because traditional cge modeling approaches cannot capture the impact of a sector s recent structural changes we present a step by step approach to incorporate different energy matrices from an external engineering bottom up model into the cge model the results indicate that the business as usual bau scenario in which structural changes are not considered significantly overstates expected emissions conversely considering structural changes in our cge model shows chile advancing towards its declared nationally determined contribution ndc to reduce greenhouse gas emissions furthermore the methodology implemented in the study has the advantage of being a simple integrated approach that is coherent with current modeling capacities in many developing contexts

experimental tests of core theory and the coase theorem inefficiency and cycling abstract we examine experimentally the bargaining process and the final allocation of payoffs in games that differ in terms of whether the core exists and in the initial allocation of property rights among the players this paper highlights the interaction among property rights transaction costs and the empty core our experimental results indicate that the existence of the core is an important determinant of bargaining generally and the coase theorem in particular they confirm our conjecture that when the core is empty and property rights are ill defined coasean efficiency breaks down among other results our experiments show that the number of inefficient non pareto optimal agreements and bargaining rounds with cycling are significantly greater when the core is empty than when the core exists especially when property rights are ill defined our results suggest an economic role for specific property right arrangements to resolve the empty core

a general equilibrium analysis on the impacts of regional and sectoral emission allowance allocation at carbon trading market abstract it is critical to adapt to climate change and reduce the overall carbon emissions china announced its nationally determined contributions ndc at the paris climate conference in 2015 the carbon cap and trade scheme which plays a key role in carbon emissions abatement is an effective policy for china to achieve its ndc this study focuses on the allocation of regional and sectoral initial carbon emission allowances in shanghai an impact evaluation on the macro economy carbon trading markets and participating sectors for the year 2030 was conducted by applying a computable general equilibrium cge model the results show that the carbon cap and trade scheme would cause a 3 4 gdp loss and an 8 9 welfare loss in 2030 the carbon price would be 161 2 usd t and 147 2 usd t under the two representative scenarios the allocation of initial allowances would have a significant impact on both carbon market scale and sectoral trading behaviors the power generation sector and the petrol oil sector would undertake the greatest output loss while the metal smelting sector would become the main seller furthermore the initial allowances allocation under a certain abatement target would hardly affect sectoral production but remarkably affect trade behaviors at the carbon trading markets

holdout existence information and contingent contracting abstractthe holdout problem permeates policy discussions of legal issues involving bargaining for land acquisition and more broadly impacts multilateral bargaining between agents laboratory experiments investigate the scope of the holdout problem the research strategy incorporates as treatment variables available information and the exposure problem arising from the unavailability of contingent contracts an examination reveals that holdout can reliably produce large inefficiencies and lost opportunities for mutually advantageous trade the introduction of contingent contracts facilitates successful bargaining however buyers are not made significantly better off by contingent contracts

experimental comparison of impact of auction format on carbon allowance market abstract carbon allowances auctions are a good way to achieve the carbon allowance allocations under international agreements to address global climate change based on an economic experiment this paper compares three possible carbon allowance auction formats uniform price auction discriminatory price auction and english clock auction with heterogeneous bidders coal power plants and gas power plants from four perspectives carbon price auction efficiency demand withholding and fluctuations in power supplies possibilities of collusion among bidders and impacts of allowance banking and penalty price on bidders behaviors under different auction formats are also examined the results show that 1 when there are relatively more bidders and there are no obvious communications between them despite there being some tacit collusion efficiency of english clock auction is greater than the other two formats 2 when there are relatively fewer bidders and there are obvious communications between them explicit collusions are observed under english clock auction in this case discriminatory price auction helps prevent collusion to some extents 3 in the banking scenario more speculations are observed while penalty price exacerbates price volatility

the effects of rent asymmetries in experimental auction markets abstract we report the results of twelve double auction market experiments designed to analyze the effects of asymmetric induced supply and demand configurations on the price convergence path toward a competitive equilibrium the proposition convergence bias that prices tend to approach the competitive equilibrium from above below when consumer surplus is greater less than producer surplus cannot be rejected we do however reject the proposition convergence symmetry that these convergence biases are of equal absolute magnitude excesses of producer over consumer surplus are found to have a more pronounced effect on the sequence of contract prices

output based allocations and revenue recycling implications for the new zealand emissions trading scheme abstract the new zealand emissions trading scheme nz ets is more comprehensive in its coverage of emissions than schemes introduced or proposed to date in any other country in that it includes agricultural greenhouse gases which account for half of new zealand s total emissions but motivated by concerns for the international competitiveness of emissions intensive trade exposed industrial and agricultural activities current legislation provides for substantial ongoing free allocations to such activities linked to their output here we use a computable general equilibrium model to analyse the impacts of output based allocation given the possibility of recycling net revenues to reduce prior distorting taxes unlike previous modelling studies of alternative nz ets designs we allow for a more realistic modelling both of capital and labour supply we find that as suggested by theoretical results interactions between the ets and existing taxes are important given any level of output based allocation the negative macroeconomic impacts can be reduced by recycling net revenues as efficiently as possible less obviously we find that there may be an optimal non zero level of output based allocation this optimal level increases as the carbon price and or factor supply elasticities increase but decreases if revenues are recycled with greater efficiency

analysis of the economic impact of different chinese climate policy options based on a cge model incorporating endogenous technological change abatement cost is the main concern for climate change mitigation and the key factor for mitigation cost is technological change this study established an integrated economic energy environmental dynamic computable general equilibrium cge model representing endogenous technological change for china s climate change policy analysis this study analyzed and compared the economic impact of different approaches to mitigation commitments as well as the potential role of technological change in the formulation of mitigation targets and commitments taking into account china s climate policy making needs based on the current international climate negotiation process the results show that absolute emission limits similar to the kyoto protocol will seriously impede the future economic development of china while the impact of an 80 reduction in carbon intensity forecast for 2050 based on the 2005 level is relatively small technological change can promote economic growth improve energy efficiency and reduce carbon intensity per unit of output through the substitution of production factors consequently it can reduce marginal abatement cost and related gdp loss by mitigation at the same time it can increase mitigation potentials and extend the emission reduction amount showing that consideration of the impact of technological change when deciding the emission reduction targets is necessary

stock price responses to the eco points programme for electrical household appliances evidence from japan abstractthis article examines the japanese government s project for green consumer electronics to promote business through the use of eco points and its economic impact on consumer electronics firms stock prices there has been little research on the economic effect of this project in order to achieve our aim we employ event study methodology our results show that stock prices responded positively to programme adoption thereby indicating that the programme had positive effects on the related firms performance the results also show that the programme s economic effects gradually decreased over each subsequent programme extension this probably occurred because the programme targeted durable goods which consumers do not replace frequently

designing an emissions trading scheme for china an up to date climate policy assessment abstract we assess recent chinese climate policy proposals in a multi region multi sector computable general equilibrium model with a chinese carbon emissions trading scheme ets when the emissions intensity per gdp in 2020 is required to be 45 lower than in 2005 the model simulations indicate that the climate policy induced welfare loss in 2020 measured as the level of gdp and welfare in 2020 under climate policy relative to their level under business as usual bau in the same year is about 1 the chinese welfare loss in 2020 slightly increases in the chinese rate of economic growth in 2020 when keeping the emissions target fixed at the 2020 level after 2020 in absolute terms the welfare loss will reach about 2 in 2030 if china s annual economic growth rate is 0 5 percentage points higher lower the climate policy induced welfare loss in 2030 will rise decline by about 0 5 percentage points full auctioning of carbon allowances results in very similar macroeconomic effects as free allocation but full auctioning leads to higher reductions in output than free allocation for ets sectors linking the chinese to the european ets and restricting the transfer volume to one third of the eu s reduction effort creates at best a small benefit for china yet with smaller sectoral output reductions than auctioning these results highlight the importance of designing the chinese ets wisely

u s equity markets and environmental policy the case of electric utility investor behavior during the passage of the clean air act amendments of 1990 we examine electric utilityinvestor reaction surrounding twenty twomilestones associated with the passage of theclean air act amendments of 1990 resultssuggest that investors did not react sharply tothe passage of the amendments to the extentthat statistically significant effects wereobserved we interpret the results as moreindicative of investor concern over resolutionof uncertainty surrounding the politicalprocess and resulting provisions than ofconcern over the expected costs of compliancefollowing passage of the amendments weobserved little if any difference betweenutilities subject to phase i restrictions andthose not subject to phase i finally changesin monthly excess returns appear to haveresulted from changes in u s interest ratesand investor concern over power industryderegulation we view our results as importantbecause any wealth effects due to environmentalregulations represent a real economic costassociated with their implementation in thissense we view the results as good news foru s environmental policy makers

advance production in oral double auction markets abstract the effects of advance production in oral double auction markets are investigated price distributions under advance production ap and production to demand td conditions do not differ however production and efficiency in ap markets tend to be lower than in td markets

price drivers and structural breaks in european carbon prices 2005 2007 this article aims at characterizing the daily price fundamentals of european union allowances euas traded since 2005 as part of the emissions trading scheme ets the presence of two structural changes on april 2006 following the disclosure of 2005 verified emissions and on october 2006 following the european commission announcement of stricter phase ii allocation allows to isolate distinct fundamentals evolving overtime the results extend previous literature by showing that eua spot prices react not only to energy prices with forecast errors but also to unanticipated temperatures changes during colder events besides the sub period decomposition of the pilot phase gives a better grasp of institutional and market events that drive allowance price changes

tradable allowances in a restructuring electric industry abstract the so 2 tradable allowance program has been introduced into an electric industry undergoing dramatic changes entry of nonutilities into the industry and the emergence of stranded costs are two major changes that are shown to have an impact on the market for allowances and the industry s incentives to switch to cleaner fuels the degree of impact depends on the extent to which consumers bypass traditional utilities and buy from entrants and on public utility commission policies regarding the recovery of stranded costs in turn the amount of stranded costs depends on fuel switching the results follow from simulations of a two utility model that illustrate the qualitative effects of changing policies

on corporate governance a study of proxy contests abstract this paper examines a sample of firms experiencing proxy contests for seats on their board of directors dissident shareholders usually fail to obtain a majority of board seats nevertheless they capture some seats via mechanisms such as cumulative voting in over half of the sample contests regardless of proxy contest outcome positive and statistically significant share price performance is associated with the contest that finding is predicted by the standard economic analysis of proxy contests in which the challenges benefit shareholders by improving corporate performance the finding runs counter to the claim of berle 1962 that the economists view of proxy contests is a wholly imaginary picture a portion of the positive share price changes taking place in the early stages of some proxy contests is not permanent however and as suggested by manne 1962 is at least partially attributable to temporary increases in the market value of the vote attached to corporate shares

allocating uncertain and unresponsive resources an experimental approach we identify an important class of economic problems that arise naturally in several applications the allocation of multiple resources when there are uncertainties in demand or supply unresponsive supplies no inventories and fixed capacities and significant demand indivisibilities rigidities examples of such problems include scheduling job shops airports or supercomputers zero inventory planning and the allocation and pricing of nasa s planned space station using experimental methods we show that the two most common organizations used to deal with this problem markets and administrative procedures can perform at very low efficiencies 60 65 efficiency in a seemingly robust example thus there is a need to design new mechanisms that more efficiently allocate resources in these environments we develop and analyze two mechanisms that arise naturally from auctions used to allocate single dimensional goods these new mechanisms involve computer assisted coordination made possible by the existence of networked computers both mechanisms significantly improve on the performance of administrative and market procedures

designing an emissions trading scheme for china with a dynamic computable general equilibrium model abstract to fulfill its copenhagen pledges to control carbon emissions and mitigate climate change china plans to establish a nationwide emissions trading scheme ets in 2016 this paper develops a multi sector dynamic computable general equilibrium model with an ets module to study the appropriate ets policy design including a carbon cap permit allocation and supplementary policies e g penalty policies and subsidy policies the main results are as follows 1 to achieve china s copenhagen pledge the equilibrium nationwide carbon price is observed to be between 36 and 40 rmb yuan per metric ton 2 the ets policy has a cost effective mitigation effect by improving china s production and energy structures with relatively little economic harm 3 various ets sub policies should be carefully designed to balance economic growth and carbon mitigation in particular the carbon cap should be set according to china s copenhagen pledge a relatively large distribution ratio of free permits the output based grandfathering rule for free permits a penalty price on illegitimate emissions slightly above the carbon price and a sufficient subsidy from ets revenue are strongly recommended in the early stages to avoid significant economic loss these designs can be adjusted in later stages to enhance the mitigation effect

the market for sulfur dioxide emissions the 1990 clean air act amendments initiated the first large scale use of the tradable permit approach to pollution control the theoretical case for this approach rests on the assumption of an efficient market for emission rights the authors empirical analysis shows that the emission rights market created by the 1990 amendments had become reasonably efficient by mid 1994 they also show that the auctions specified in the amendments to jump start trading had become a small part of the overall market finally the authors demonstrate that the strategic bidding behavior discussed in the literature has had no effect on market prices copyright 1998 by american economic association

transaction costs and tradeable permits abstract tradeable permit systems are at the center of current interest and activity in market based reforms of environmental policy because these systems can offer significant advantages over conventional approaches to pollution control unfortunately claims made for their relative cost effectiveness have often been exaggerated transaction costs which may be significant in these markets reduce trading levels and increase abatement costs in some cases equilibrium permit allocations and hence aggregate control costs are sensitive to initial permit distributions providing an efficiency justification for politicians typical focus on initial allocations

corporate takeover bids methods of payment and bidding firms stock returns this study explores the role of the method of payment in explaining common stock returns of bidding firms at the announcement of takeover bids the results reveal significant differences in the abnormal returns between common stock exchanges and cash offers the results are independent of the type of takeover bid i e merger or tender offer and of bid outcomes these findings supported by analysis of nonconvertible bonds are attributed mainly to signalling effects and imply that the inconclusive evidence of earlier studies on takeovers may be due to their failure to control for the method of payment recent studies on corporate takeovers provide inconclusive results on the valuation effects of acquisitions on the common stock of bidding firms 1 substantial differences are reported between the studies that analyze acquisitions initiated as tender offers and those that confine their samples to merger proposals the existence of mixed empirical findings for the bidding firms makes it difficult to interpret existing evidence and to draw conclusions about the managers acquisition motivations nevertheless the reason for the substantial difference between empirical findings on mergers and tender offers still remains an unresolved issue it is observed however that mergers are usually common stock exchange offers whereas tender offers are usually cash offers given that different methods of financing a project have different signalling implications myers and majluf 39 the differential stock returns of bidders in mergers and tender offers may be due to the method of acquisition financing

gains from emission trading under multiple stabilization targets and technological constraints abstract this study quantified the effectiveness of emission trading by considering multiple technological constraints burden sharing schemes and climate stabilization targets we used a global computable general equilibrium model and evaluated the effectiveness of emission trading using welfare losses associated with climate mitigation for scenarios with and without emission trading as measured by the hicksian equivalent variation hev we found that emission trading contributed to a reduction in the economic losses associated with climate mitigation for all technological assumptions burden sharing schemes and stabilization targets the net global welfare losses in scenarios without emission trading ranged between 0 7 and 1 9 whereas emission trading reduced the losses by 0 1 to 0 5 the range depended on the assumptions in the burden sharing schemes technological constraints and stabilization targets the percentage change in welfare gain from emission trading varied regionally and was relatively high in low income or middle income countries 0 2 to 1 0 and 0 1 to 1 2 respectively compared to high income countries 0 1 to 0 3 some regions displayed negative values with regard to the effectiveness of emission trading which might be due to the change in goods and service trades associated with emission trading if the usage of carbon capture and storage was constrained welfare loss became large and the effectiveness of emission trading ultimately increased the use of a burden sharing scheme was a significant factor in changing the effectiveness of emission trading and the per capita emission convergence in 2050 was more effective for emission trading than a per income convergence

an equilibrium analysis of the simultaneous ascending auction we provide a bayes nash equilibrium analysis of the simultaneous ascending auction saa when local bidders interested in a single item compete against global bidders interested in aggregating many items we first assume that each local bidder values only a specific item e g the license for the region where it has monopoly power and that global bidders valuation functions are convex for this environment we show that a global bidder faces an exposure problem with adverse consequences for revenue and efficiency in the limit when the number of items grows large the saa is revenue and efficiency equivalent to the vickrey clarke groves vcg mechanism we extend our analysis to include the case where items are substitutes for local bidders so that price arbitrage will occur as observed in many spectrum auctions this environment which combines substitutes and complements results in an aggravated exposure problem consequently the saa is no longer efficient and may yield dramatically lower revenues than the vcg mechanism finally we relax the assumption that global bidders valuation functions are convex by considering an environment with medium sized global bidders who demand fewer than all items we show that global bidders divide the market at low prices when market sharing is feasible while they engage in mutually destructive bidding when there is a fitting problem in both cases the saa again underperforms relative to the vcg mechanism

a new and improved design for multiobject iterative auctions in this paper we present a new improved design for multiobject auctions and report on the results of experimental tests of that design we merge the better features of two extant but very different auction processes the simultaneous multiple round smr design used by the fcc to auction the electromagnetic spectrum and the adaptive user selection mechanism ausm of banks et al 1989 allocating uncertain and unresponsive resources an experimental approach rand journal of economics vol 20 no 1 pp 1 25 then by adding one crucial new feature we are able to create a new design the resource allocation design rad auction process which performs better than both our experiments demonstrate that the rad auction achieves higher efficiencies lower bidder losses higher net revenues and faster times to completion without increasing the complexity of a bidder s problem

the exposure problem and market design markets have an exposure problem when getting to the optimal allocation requires a sequence of transactions which if started but not completed leaves at least one trader with losses we use laboratory experiments to evaluate the effect of the exposure problem on alternative market mechanisms the continuous double auction performs poorly efficiency is only 20 when exposure is high and 55 when it is low a package market effectively eliminates the exposure problem in low and high exposure treatments efficiency is 82 and 89 respectively building on stability notions from matching theory we introduce the concept of mechanism stability a model of trade that combines mechanism stability with noisy best responses and imperfect foresight explains the difference in market performance finally decentralized bargaining with contingent contracts performs well with perfect information and communication but not in the more realistic case when traders preferences are privately known

market power in tradable emission markets a laboratory testbed for emission trading in port phillip bay victoria abstract in theory competitive emission permit markets minimize total abatement costs permit markets are often imperfectly competitive however and may be thin and dominated by large firms the dominant firm s could exercise market power and increase other firms costs of pollution control while reducing their own emission control costs this paper reports a testbed laboratory experiment to examine whether a dominant firm can exercise market power in a permit market organized using the double auction trading institution our parameters approximate the abatement costs of sources in a proposed tradable emissions market for the reduction of nitrogen in the port phillip watershed in victoria australia we vary across treatments the initial allocation of permits to sources so that in one treatment the seller of permits is a monopolist and in another treatment the market is duopolistic we also vary the information that subjects have about the number and abatement costs of their competitors we find that prices and seller profits are higher and efficiency is lower on average in the monopoly sessions compared with the duopoly sessions but the differences are not substantial and are not statistically significant due to pronounced variation across sessions moreover prices profits and transaction volumes are usually much closer to the competitive equilibrium ce than the monopoly equilibrium

the economic impact of carbon pricing with regulated electricity prices in china an application of a computable general equilibrium approach we use a dynamic cge model sicge to assess the economic and climate impacts of emissions trading system ets in china with a carbon price of 100 yuan ton co2 a particular focus is given to the regulated electricity price regime which is a major concern of electricity sector s cost effective participation in ets in china we found 1 carbon pricing is an effective policy for china to reduce co2 emissions total co2 emissions reduction ranges from 6 8 to 11 2 in short term 2 rigid electricity price entails lower co2 emissions reduction but can be considered as a feasible starting point to introduce carbon pricing policies in short term as long as governmental subsidies are given to electricity production 3 in mid and long term the efficient policy is to earmark carbon revenue with competitive electricity price we propose to use carbon revenue to reduce consumption tax in the first year of the introduction of carbon price and to use the carbon revenue to reduce production tax in following years

avoidable cost ride a double auction roller coaster the double auction trading institution has been highly efficient across diverse marginal cost market structures whether human subjects or zero intelligence robots populated those markets accordingly many researchers suspect that double auction performance transcends market structure and agent strategy but the authors show that large avoidable costs undermine the efficiency and stability of human subject double auctions and these low human efficiencies are simultaneously well above zero intelligence efficiencies their results dramatically illustrate the potential havoc wrought by highly competitive institutions when they must cope with nonconvex technologies copyright 1996 by american economic association

multi item auctions a collection of items is to be distributed among several bidders and each bidder is to receive at most one item assuming that the bidders place some monetary value on each of the items it has been shown that there is a unique vector of equilibrium prices that is optimal in a suitable sense for the bidders in this paper we describe two dynamic auction mechanisms one achieves this equilibrium and the other approximates it to any desired degree of accuracy

a simple testable model of double auction markets abstract we propose a model of price formation in double auction markets which employs the strong simplifying assumption that agents neglect strategic feedback effects and regard themselves as playing a game against nature agents otherwise are strict expected utility maximizers employing bayesian updating procedures we prove the optimality of simple aggressive reservation price strategies in our general model and propose a parametric form that yields very detailed and computable predictions of market behavior

allocative efficiency of markets with zero intelligence traders market as a partial substitute for individual rationality we report market experiments in which human traders are replaced by zero intelligence programs that submit random bids and offers imposing a budget constraint i e not permitting traders to sell below their costs or buy above their values is sufficient to raise the allocative efficiency of these auctions close to 100 percent allocative efficiency of a double auction derives largely from its structure independent of traders motivation intelligence or learning adam smith s invisible hand may be more powerful than some may have thought it can generate aggregate rationality not only from individual rationality but also from individual irrationality

package auctions and exchanges we report recent advances concerning the package allocation problem in which traders seek to buy or sell combinations of goods the problems are most difficult when some goods are not substitutes in that case competitive equilibrium typically fail to exist but the core is non empty and comprises the competitive solutions also in that case the vickrey auction fails to select core allocations and yield revenues that are less than competitive the ausubel milgrom auction generally selects core allocations and when goods are substitutes prescribes the vickrey allocation we also evaluate the problems and promise of mechanisms for the package exchange problem

climate change impacts on socioeconomic activities through labor productivity changes considering interactions between socioeconomic and climate systems abstract while human socioeconomic activity leads to climate change the latter also affects the former socioeconomic and climate systems have considerable interactions some studies have looked at the effects of climate change on labor productivity and gross domestic product yet they have not considered the interaction between socioeconomic and climate systems this study therefore examined that aspect as well as the economic impact of climate change induced labor productivity change business as usual and two emissions reduction scenarios 2 c and representative concentration pathway 4 5 were adopted data analysis employed a computable general equilibrium model and a simple climate model the results show that global economic impacts of climate change induced labor productivity change have not been large a negative effect on economic activities was found when the relationship between climate change and labor productivity was considered in the economic model although such impacts were larger in the business as usual scenario that was not the case in the 2 c scenario the results suggest that greater levels of climate change are in accordance with greater socioeconomic impact at the global level in particular impact on high temperature regions was found to be considerable interestingly not all regions experienced economic loss from climate change some in the low to medium temperature zones received a positive economic effect because of comparative advantage caused by differences in labor productivity changes among regions the coupled modeling scheme ultimately was effective in evaluating the interaction expanded assessment of climate change mitigation and adaptation will aid further understanding of the interaction of climate change and socioeconomic activities

tradeable permits for pollution control when emission location matters what have we learned our knowledge about tradeable permit approaches to pollution control has grown rapidly in the two decades in which they have received serious analytical attention not only have the theoretical models become more focused and the empirical work more detailed but we have now had over a decade of experience with them in the u s this article draws upon economic theory empirical studies and actual experience with implementation to summarize what we have learned about applying tradeable permits to air pollution control in the special circumstance where the spatial aspects of the problem are a prime consideration

quantifying regional economic impacts of co2 intensity targets in china we acknowledge the support of the ministry of science and technology of china through the institute for energy environment and economy at tsinghua university and the support from graduate school of tsinghua university which is supporting zhang da s doctoral research as a 22 visiting scholar at the massachusetts institute of technology we are also grateful for the support provided by rio tinto china and social science key research program from national social science foundation china of grant no 09 zd029 we further acknowledge the support of eni s p a icf international and shell founding sponsors of the china energy and climate project for supporting this model development work we would further like to thank dr john reilly dr sergey paltsev dr kyung min nam dr henry chen paul kishimoto and tianyu qi at joint program on the science and policy of global change and participants in the annual meeting of china energy and climate project and ecomod 2012 conference for helpful comments and discussion 23

event studies in economics and finance the event study is an important research tool in economics and finance the goal of an event study is to measure the effects of an economic event on the value of firms event study methods exploit the fact that given rationality in the marketplace the effects of an event will be reflected immediately in security prices thus the impact can be measured by examining security prices surrounding the event in this paper event study methods are described including some of the potential complications an example is included to illustrate the approach

market power in oral double auctions this paper reports the results of a series of oral double auction experiments in which some traders possess market power a market is set up in which the configuration of the supply and demand curves leads to an asymmetry between buyers and sellers in their abilities to influence transactions prices this market structure does not always lead to convergence to the competitive equilibrium price despite the competitive nature of the oral double auction institution the nonconvergence occurs most frequently in the experiments involving experienced subjects