Buckley, NeilJ.; Mestelman, Stuart; Muller, R. Andrew - In: Pacific Economic Review 11 (2006) 2, pp. 149-166
Two approaches to emissions trading are cap-and-trade, with an aggregate cap on emissions distributed as emission allowances, and baseline-and-credit, with firms earning emission reduction credits for emissions below baselines. Theory suggests the long-run equilibria of the plans will differ...