TRADABLE CO2 EMISSION PERMITS - INITIAL DISTRIBUTION AS A JUSTICE PROBLEM

One characteristic of tradeable emission permits is that efficiency and justice considerations can be separated. While Pareto optimality is an accepted efficiency principle, there is not a consensus on a 'best' equity principle. In this article, conventional justice principles are used to evaluate alternative allocation rules for tradeable CO2 permits, and a distribution proportional to population is recommended. Arguments against the population rule are discussed, especially those pertaining to political feasibility. While justice and political feasibility may indeed contrast, it still may be possible to emphasise the population rule in the future.