Research On The Market Maker Quotation System In Emission Trading Market

Sewage treatment is the way to create a harmonious living environment, but also an important issue currently facing the world’s. International experience shows that compared to executive orders and tax measures, emissions trading mechanism to better protect the community under the premise of wealth creation, maximize environmental, economic and social benefits. China began to actively carry out experimental work from the late 1980s, we have established sulfur dioxide (SO2), chemical needed oxygen (COD), nitrogen and other major pollutants pilot trading platform. But trading is not active, such as lack of liquidity problems.The Government’s approach is to use administrative means to promote, but it can not eradicate the market failure of asymmetric information environment, and even might germination power rent-seeking, market forces caused by man-made and other issues.Theoretical study, researchers from a number of transactions, transaction monitoring and other dimensions of the recommendations made to improve the strategy of market transactions. Overall, however, the current theoretical research is still in the initial stage of exploration.This study proposes the use of market-maker quote trading system of emissions trading mechanism to improve the view. In this paper, this view rely on the following three-way argument. (1) theoretical arguments-Microstructure Theory. Microstructure theory research shows that one of the main factors that also affect the market price of trading systems and irrational trading system will hinder the market price discovery, reduced market liquidity. Emission rights trading system secondary market price mechanism failed to effectively regulate supply and demand, is likely to lead to emissions trading market failure, lack of liquidity of the underlying institutional reasons. (2) emissions trading market status quo argument. The emission of pollutants component companies is more complex, the sewage is still relatively low level of standardization warrants trade areas has been limited, is not conducive to non-professional traders to carry out the transaction; guidance and real price set by the government may have very different, the price formation mechanism needs to be improved; currently in auction-based trading single, rigid, unable to meet the diverse needs of enterprises, can not form an effective seller; current participants in emissions trading emission rights is mainly the transferor, transferee emission rights and emission rights Trading Center, a similar financial market assets evaluation, legal affairs, banking, insurance and other institutions involved is very low, the lack of professional medium of exchange, is not conducive to transactions. (3) to enhance the liquidity of the market maker empirical argument. As a financial intermediary market makers to provide liquidity to the value of empirical research has gained wide support.In order to implement the market-maker quotes scientific strategy trading system, evaluate the effectiveness of market maker quotes in emissions trading in the trading system, the paper Construction of Tripartite dynamic game model makers offer optimal core market maker quotes The formation mechanism and the institutional market maker quotes transaction costs, analyze the long-term evolution of the efficiency of emissions trading markets by simulation method approach. The main conclusions include:Best Price (1) the marginal cost of information by market makers, affect the amount of the initial allocation of pollution abatement cost and marginal sewage warrants, the spread of information by the marginal cost of market makers, sewage warrants marginal governance needs of enterprises Cost of two parts. The costs are too high or if the market information sewerage initial distribution is extremely uneven warrants market trading is difficult to produce. Historical emissions standard free allocation may lead to inefficient transactions, but can be improved by incorporating the ability to assess pollution control strategy. (2) Subject to the same volume, compared with the trading mechanism, market makers offer more savings in the mass market in the information society of the total cost. Information on the total cost savings of social considerations, implementing market-maker quote trading system should first upgrade the sewage business transactions will, including effective market monitoring mechanism, incentive mechanism transactions. (3) trading market maker quotes a good price discovery, price volatility, the existence of market power, and other environment can enhance market liquidity. (4) The system will reduce the spread of earnings increases, emissions trading market maker quotations should be limited magnitude, according to the simulation results, the spread should be controlled within 20%.In order to maximize the effectiveness of market maker trading system of tradable emission permits in this paper based on research findings, the experience of American and European countries as well as between bank bond market maker transactions undertaken to design a set of market-maker quotes transaction security incentive and restraint system. These include:the qualification system of market makers, market makers incentive system, information disclosure system of market makers and market makers regulatory system, the implementation of which the market maker quotes traded in the market to provide our emissions trading theory and policy recommendations.