Findings from the study indicate that climate policy has had a modest impact on technological development in the Swedish pulp and paper industry, with a rather negative impact in cases where the impact is significant.
Using a rather unexplored dataset on tradable permit transaction, the study found that;
Transaction costs played an important role in the initial years of the EU ETS and were significant in explaining why some ETS firms did not participate in the European emission trading market and chose to trade allowances individually via third parties.
It was also evident that the importance of transaction costs was declining over time.
The study also found evidence that supports the concerns raised by the European Commission that transaction costs might be excessive for smaller participants.