1 -5 6-10 11-15 16-20 21-25 26-30
Traders' category according to value
Figure 3: Overall ownership of permits in allocation stage (first stage) and auction
(second stage)
The total trading volume meant 71 permits exchanged hands. Sixteen permits were sold
from high value category traders to low value category traders, 40 permits from low
value to high value traders and fifteen permits were in the same category. The average
market price of the permit for the whole period was 16.01 ECU.
Sources of inefficiency
Table 1 breaks down the efficiency losses in each period owing to (1) extra-marginal
trades and (2) non-execution of mutually profitable trades. The non-trade inefficiency is
more common than inefficiency owing to extra-marginal trade. The table also highlights
that neither type of inefficiency decreases with traders’ experience.
Table 1 : Decomposition of efficiency loss
|
Period |
Average |
Percent loss due to _______extra-marginal trades_______ |
Percent loss due to _______profitable trades not executed |
|
1 |
0.27 |
0.33 |
0.67 |
|
2 |
0.45 |
0.19 |
0.81 |
|
3 |
0.41 |
0.05 |
0.95 |
|
4 |
0.71 |
0.1 |
0.9 |
|
5 |
0.55 |
0.4 |
0.6 |
|
6 |
0.79 |
0.12 |
0.88 |
|
7 |
0.42 |
0.37 |
0.63 |
|
8 |
0.49 |
0.21 |
0.79 |
|
9 |
0.56 |
0.19 |
0.81 |
|
10 |
________0.79 |
_____________________0.16__________ |
_____________________0.84________________ |
10