Environmental and production rights futures: a new booming market?

J.M.E. Pennings, M.T.G. Meulenberg

Research output: Contribution to journalArticleAcademicpeer-review

Abstract

Governments or supranational organizations have begun to introduce environmental rights (such as sulfur dioxide or chlorofluorocarbon rights) and production rights (such as milk and fishery rights) to better link production process costs and results. The authors show that the characteristics of these rights make them quite suitable for futures trading. They are an efficient tool for hedging against adverse fluctuations both in prices of rights and in the profit capacity of complicated production processes.
Original languageEnglish
Pages (from-to)40-44
JournalDerivatives Quarterly
Volume3
Issue number1
Publication statusPublished - 1996

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