Some economists have argued for an upstream, economy-wide cap-and-trade scheme as the primary tool for achieving the required reduction in greenhouse gas (GHG) emissions. The paper reviews the evidence on how SO2 emissions were reduced and the extent to which actual emission trading was responsible for the reduction. It also identifies differences between the past regulation of SO2 and other air pollutants and the challenges presented by the regulation of GHGs.
Some economists have argued for an upstream, economy-wide cap-and-trade scheme as the primary tool for achieving the required reduction in greenhouse gas (GHG) emissions. The paper reviews t…