Hedging in Coal Contracts under the Acid Rain Program
研究可交易许可证制度下，受监管企业如何通过煤炭采购合同对冲硫排放成本的不确定性，并估计了高硫煤拒收选项的定价。
Tradable permit schemes introduce uncertainty into the cost of regulatory compliance due to the permits’ uncertain price. Regulated firms can hedge this uncertainty through their contracts for fuel procurement. Data on coal contracts are used to estimate how the option not to be delivered higher-sulfur coal is priced. Results show that under a tradable permit scheme, coal prices are reduced for an increase in the sulfur bound controlling for reductions in price due to higher delivered sulfur content. <i></i>