Well designed emission trading systems are environmentally effective and economically efficient instruments to address emissions of CO2 and other greenhouse gases. This paper discusses interactions that can occur when a cap-and-trade based emission trading system is combined with overlapping...

Based on an in-depth literature review and responses to a survey among OECD member countries, this paper discusses the use of flexibility mechanisms in environmental regulations. Such mechanisms can provide flexibility as to how a given environmental improvement is achieved, regarding where...