Developing countries in Asia face a variety of environmental challenges. Although environmental economics grew mostly out of the experience of developed countries, decades of environmental economics research offer important and useful lessons for environmental regulation in developing countries...

A major concern with TEPs is that stochastic permit prices may reduce firm incentive to invest in abatement capital or technologies relative to other policies such as a fixed emissions charge. However, under efficient permit trading, the price uncertainty is caused by abatement cost...