Abstract for: Greening the Economy with New Markets: Lessons from System Dynamics Simulation of Energy and Environmental Markets

This paper begins with background on government programs to spur economic growth through investment in green infrastructure and the creation of new markets. System dynamics has been put to good use in analyses of new and proposed markets dealing with energy and the environment. The paper describes simulation analysis of markets for renewable certificates, riparian shading offsets, wholesale electricity generation and carbon allowances. The paper summarizes the main policy conclusions from these studies, especially the conclusions that appear across markets and across countries. The paper concludes with a discussion of “cap and dividend,” a bold, new proposal for a carbon market in the USA.