This work aims to respond to current European policy discussions on applying emission trading on a continental scale. It blends theory and practice.

Part I Theory, models, and practice: economic instruments in theory
instruments in theory when location matters
economic instruments in an international context - theory
empirical simulation models and emission trading
emission trading for air pollution in practice
theory, models, and practice - concluding observations. Part II Application to Sulfur emissions in Europe: the institutional framework for controlling sulfur emissions in Europe
trading with exchange rates
sulfur emission trading in Europe - a model simulation
an institutional design for joint implementation.