Purpose

The purpose of this paper is to analyze the operational decisions of a manufacturer who produces multiple products and the government's selection of cap-and-trade and carbon tax regulations.

Design/methodology/approach

This paper explores the production decisions of a multi-product manufacturer under cap-and-trade and carbon tax regulations in a cap-dependent carbon trading price setting and compares carbon emission, the manufacturer's profits and social welfare under the two regulations. Game theory and extreme value theory are used to analyze our models.

Findings

First, the authors find that the optimal profit of the manufacturer (the optimal cap) increases and then decreases with the cap (the unit carbon emission of product). Second, if the environmental damage coefficient is moderate, the optimal cap of unit environmental damage coefficient is independent of the product carbon emission or other related product parameters. Ultimately, cap-and-trade regulation always generates more carbon emission than carbon tax regulation. And cap-and-trade regulation (carbon tax regulation) can generate more social welfare if the environmental damage coefficient is low (high), and the social welfare under the two regulations is equal to each other, or otherwise.

Originality/value

This paper contributes the prior literature by considering the inverse relationship of the allocated cap and the carbon trading price and discusses the social welfare under cap-and-trade and carbon tax regulations. Some important and new results are found, which can guide the government's implementation of the two regulations.

中文翻译：

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限额依赖碳交易价格设置中限额与交易和碳税法规的选择

目的

本文的目的是分析生产多种产品的制造商的运营决策以及政府对限额交易和碳税法规的选择。

设计/方法/方法

本文探讨了在限额依赖的碳交易价格设置下多产品制造商在限额与交易和碳税法规下的生产决策，并比较了两种法规下的碳排放、制造商利润和社会福利。博弈论和极值理论被用来分析我们的模型。

发现

首先，作者发现制造商的最优利润（最优上限）随着上限（产品的单位碳排放量）增加然后下降。其次，如果环境损害系数适中，单位环境损害系数的最优上限与产品碳排放或其他相关产品参数无关。最终，总量控制与交易监管总是比碳税监管产生更多的碳排放。如果环境损害系数低（高），且两种规定下的社会福利相等，或者相反，则限额与交易监管（碳税监管）可以产生更多的社会福利。

原创性/价值

本文通过考虑分配限额与碳交易价格的反比关系，贡献了现有文献，并讨论了限额与交易和碳税法规下的社会福利。发现了一些重要的新成果，可以指导政府实施这两项规定。