TY  - JOUR
A1  - Zhu, Jinshan
T1  - Assessing China’s price review policy on Clean Development Mechanism projects
T2  - European Journal of Law and Economics
N2  - The Kyoto Protocol’s Clean Development Mechanism (CDM) allows developed countries to meet part of their obligational emission reductions by carrying out emission reduction projects in developing countries. China imposed a price floor to the CDM carbon credits produced in China through its price review policy. Scholars have not agreed on the purpose of China’s price review policy. With a theoretical model and a coherent empirical study, the present study shows that the price floor imposed by China’s price review is more likely to protect those domestic project owners against price discrimination, rather than to distort the CDM market. Nevertheless, China’s price review has its own flaws. Although a regression study shows month of approval, types of projects and location of project can explain 55% of price floor designation, the operation of price review remains quite random and unpredictable in individual cases. This would bring extra bureaucratically uncertainty on its way to curb market uncertainty. Its function can be fulfilled by alternative policy tools with better economic efficiency and legal legitimacy, such as mandatory price disclosure and trading forum, which doesn’t have such drawback, but still be able to alleviate possible price discrimination in individual cases.
KW  - CDM
KW  - China
KW  - Price review
KW  - Price floor
KW  - Law and economics
Y1  - 2017
UR  - https://publishup.uni-potsdam.de/frontdoor/index/index/docId/55153
SN  - 0929-1261
SN  - 1572-9990
VL  - 43
SP  - 285
EP  - 316
PB  - Springer
CY  - New York
ER  -