ABSTRACT
Two regulatory systems to control a pollutant, although well designed when considered independently of each other, when combined can emasculate one or the other in performance. This is especially true of the market incentive cap-and-trade program, which is sensitive to the constraints of external factors such as traditional regulations. In this chapter, the authors present simulations of alternative features of the cap-and-trade market model exclusive of these constraints while in the subsequent chapter, the authors analyze how these constraints affected market incentives and consequently market performance.
