Rahman, Shaikh M.Larson, Donald F.Dinar, Ariel2014-09-022014-09-022012-11https://hdl.handle.net/10986/19929This paper examines the cost of producing emission reduction credits under the Clean Development Mechanism. Using project-specific data, cost functions are estimated using alternative functional forms. The results show that, in general, the distribution of projects in the pipeline does not correspond exclusively to the cost of generating anticipated credits. Rather, investment choices appear to be influenced by location and project type considerations in a way that is consistent with variable transaction costs and investor preferences among hosts and classes of projects. This implies that comparative advantage based on the marginal cost of abatement is only one of several factors driving Clean Development Mechanism investments. This is significant since much of the conceptual and applied numerical literature concerning greenhouse gas mitigation policies relies on presumptions about relative abatement costs. The authors also find that Clean Development Mechanism projects generally exhibit constant or increasing returns to scale. In contrast, they find variations among classes of projects concerning economies of time.en-USCC BY 3.0 IGOABATEMENT COSTSABATEMENT TECHNOLOGYAFFORESTATIONAGGREGATE LEVELAIRAIR POLLUTIONALTERNATIVE METHODSAMOUNT OF EMISSIONSANIMAL WASTEANTHROPOGENIC GREENHOUSEANTHROPOGENIC GREENHOUSE GASAPPROACHATMOSPHEREBASELINE EMISSIONSBIOGASCALCULATIONCAPITAL COSTCAPITAL COST DATACAPITAL COSTSCAPITAL INVESTMENTCAPITAL INVESTMENTSCARBONCARBON CAPCARBON DIOXIDECARBON EMISSIONSCARBON MARKETCEMENTCERTIFIED EMISSION REDUCTIONCLIMATECLIMATE CHANGECLIMATE CHANGE MITIGATIONCLIMATIC CHANGECO2COALCOAL MINECOST OF PRODUCTIONCOSTS OF ABATEMENTDEVELOPMENT ECONOMICSDISCOUNT FACTORDRIVINGECOLOGICAL ECONOMICSECONOMICS OF CLIMATE CHANGEECONOMIES OF SCALEELASTICITIESELASTICITYELECTRIC POWERELECTRICITYELECTRICITY GENERATINGELECTRICITY GENERATIONELECTRICITY GENERATION CAPACITYELECTRICITY PRICESELECTRICITY PRICINGELECTRICITY SALESELECTRICITY TARIFFELECTRICITY TARIFFSEMISSION ABATEMENTEMISSION CONTROLEMISSION PERMITSEMISSION RATESEMISSION REDUCTIONEMISSION REDUCTION CREDITEMISSION REDUCTION TARGETSEMISSION TRADINGEMISSIONSEMISSIONS ABATEMENTEMISSIONS REDUCTIONEMISSIONS REDUCTIONSENERGY EFFICIENCYENVIRONMENTAL ECONOMICSENVIRONMENTAL REGULATIONFIXED COSTSFORESTFORESTRYFORESTRY PROJECTSFOSSILFOSSIL FUELFRAMEWORK CONVENTION ON CLIMATE CHANGEFUEL SWITCHINGGENERATING CAPACITYGENERATION CAPACITYGHGGHGSGREENHOUSEGREENHOUSE GASGREENHOUSE GAS ABATEMENTGREENHOUSE GAS EMISSIONSGREENHOUSE GAS MITIGATIONGREENHOUSE GASESHFCSHOURS OF OPERATIONINTEREST RATEINTERNATIONAL ENERGY AGENCYINVESTMENT DECISIONSLAND ECONOMICSLANDFILLLANDFILL GASLEVELS OF EMISSIONSLOWER COSTSMARGINAL ABATEMENTMARGINAL ABATEMENT COSTMARGINAL COSTMARGINAL COST OF ABATEMENTMETHANEMITIGATION POTENTIALN2ONET COSTNITROGENNITROUS OXIDENUCLEAR ENERGYPFCSPIPELINEPOLICY IMPLICATIONSPOLLUTANTSPOLLUTION LEVELSPOLLUTION LOADPORTFOLIOPOWER GENERATIONPOWER GENERATION CAPACITYPOWER SECTORPRESENT COSTPRESENT VALUERENEWABLE ENERGYRENEWABLE ENERGY PROJECTSRENEWABLE RESOURCERESOURCE ECONOMICSSO2SOLAR POWERSUBSTITUTIONSULFURSULFUR EMISSIONSSUPPLY SIDESUSTAINABLE DEVELOPMENTTOTAL COSTTOTAL COSTSTOTAL EMISSIONSTRADABLE EMISSIONTRANSACTION COSTSTRANSPORTTRANSPORT PROJECTSTRANSPORTATIONTRANSPORTATION PROJECTSTRUEUNCERTAINTIESUNEPVARIABLE COSTWASTEWATER TREATMENTWATER POLLUTIONWATER QUALITYWATER TREATMENTWINDWIND FARM10.1596/1813-9450-6262