(A) study on the discriminated emission rights for lindahl equilibrium

Abstract

A study of conceivable artifacial market gives useful insight in analyzing the real world bargaining situation as well as in designing the mechanism for achieving social objectives. In this paper, we design a right market in which discriminated rights are traded together and rights to possess rights are valid permanently. By this mechanism, the individual rationality and budget constraint are satisfied. In addition, in spite of a possible oligopolistic behavior of polluters or pollutees, the Nash equilibrium converges to Lindahl equilibrium dynamically.