Abstract
This paper presents the European Union's carbon trading system. With this trading system, the Europeans have demonstrated beyond doubt that the right to emit CO <sub xmlns:mml="http://www.w3.org/1998/Math/MathML" xmlns:xlink="http://www.w3.org/1999/xlink">2</sub> is destined to be a major internationally traded asset - but their experience to date exemplifies some of the pitfalls the rest of the world faces in establishing such trading systems
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