Raphael Calel

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Cheap emissions permits means industry hasn’t traded in its polluting ways. David Davies/PA

Permits to pollute can be bought too cheaply

Raphael Calel, London School of Economics and Political Science and Cameron Hepburn, London School of Economics and Political Science

When the carbon price collapsed to below €3 in April this year, EU policymakers sought to prop up carbon prices by a deal that would delay the release of carbon allowances (known as “backloading”). This…

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