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With the United States accounting for over one-fifth of global emissions of greenhouse gases, the U.S. government is facing pressures—from both domestic and international sources—to establish a comprehensive mandatory reduction program to address the risk of global climate change. If Congress decides to move forward with such a program,it could be creating an environmental regulatory regime of unprecedented scope and impact. Many policymakers are considering innovative market-based approaches to regulation, including a multibilliondollar economy-wide “cap-and-trade” program. The authors evaluate four models for a domestic program against a set of several criteria, including environmental effectiveness, cost, administrative feasibility, distributional equity, and political acceptability.