As the centrepiece of the European Union's Climate Change Programme, the European Union Emissions Trading Scheme (EU ETS) has attracted significant attention from scholars interested in the regulatory and technical issues raised by the scheme. This article reviews the current state of knowledge about emissions trading arising from this research. Three broad strands of enquiry are identified: studies of the international and EU-domestic pressures that led to the EU's conversion to emissions trading; analyses of the political processes that accompanied negotiation of the emissions trading directives; and investigations into regulatory problems encountered during the scheme's early years. From this, avenues for further research on emissions trading are proposed: (1) analyses of the consequences for the scheme of political decisions made during its negotiation, (2) further analysis of the behaviour of traders in the EU ETS market, (3) greater investigation of the scheme's implications for equity issues,and(4)comparisonofemissions trading against nonmarket instruments. Copyright © 2010 John Wiley & Sons, Ltd.

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