• Business
  • Published 1999

Can auctions control market power in emissions trading markets

@inproceedings{Muller1999CanAC,
  title={Can auctions control market power in emissions trading markets},
  author={Andrew F Muller and Stuart Mestelman and John M. Spraggon and Robert Godby},
  year={1999}
}
Using eight sessions (twenty-four ten-period markets) in a double ABA cross-over design, we demonstrate clear evidence of market power in double-auction emission trading markets (agents who are not constrained to only buy or sell). Conventional theory predicts that in half of the market-power environments monopsony should emerge and in half monopoly should emerge. Market-power outcomes are frequently observed, most often in the form of price discrimination, and most effectively by monopsonists. 

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