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We consider an infinitely-repeated oligopoly in which at each period firms not only serve the spot market by either competing in prices or quantities but also have the opportunity to trade forward contracts. Contrary to the pro-competitive results of finite-horizon models, we find that the possibility of forward trading allows firms to sustain collusive profits that otherwise would not be possible. The result holds both for price and quantity competition and follows because (collusive) contracting of future sales is more effective in deterring deviations from the collusive plan than in inducing the previously identified pro-competitive effects.JEL classification: G13, L12, L13, L50.

We consider climate policies when time preferences deviate from the standard exponential type and there is no commitment to future policies. The conceptual and quantitative results follow from the observation that, with time-declining discounting, the delay and persistence of climate impacts provide a commitment device to policy-makers. We quantify the commitment value in a climate-economy model by solving time-consistent Markov equilibrium capital and emission taxes explicitly. The equilibrium returns on capital and climate investments are no longer equal, leading to a large increase in emission taxes, compared to a benchmark with equalized returns.

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We consider per-capita carbon dioxide emission trends in 16 early developed countries over the period 1870-2028. Using a multiple-break time series method we find more evidence for very early downturns in per-capita trends than for late downturns, during the oil price shocks of the 1970s. Only for two countries do downturns in trends imply downward sloping stable trends. We also consider trends in emission composition and find little evidence for in-sample peaks for emissions from liquid and gaseous fuel uses. These results lead us to reject the oil price shocks as events causing permanent *