First Advisor

Forrest Williams

Date of Award


Document Type


Degree Name

Bachelor of Science (B.S.) in Economics and University Honors




Emissions trading -- Government policy -- California -- Evaluation, Greenhouse gas mitigation -- Government policy -- California, Climatic changes -- California, Global warming -- California




Climate change is an urgent issue unlike anything humanity has ever faced. This thesis explores a market-based tool to reduce greenhouse gas emissions and limit global warming. Specifically, it uses the California cap-and-trade program as a case study. It provides background information on this program, which was established from the California Global Warming Solutions Act of 2006 (AB 32) and in 2017 was extended to 2030. Evaluating market-based tools is becoming increasingly important as countries and states look for ways to reduce climate pollution and create investments in a clean energy future. Through analysis of government reports and a literature review, this paper finds that the program is not performing at its optimum. It recommends reducing the number of allocated permits to increase the demand and the price. Additionally, it recommends implementation of processes that evaluate and reconsider how different programs created under AB 32 can complement carbon pricing--not undermine its ability to reduce emissions. Although the California cap-and-trade program is not performing at its optimum, the program represents California's commitment to addressing climate change and acts as an international inspiration for climate action. There are multiple states that are currently considering implementing carbon pricing tools. This paper concludes by providing an overview of the pending carbon legislation in Oregon.


In Copyright. URI: This Item is protected by copyright and/or related rights. You are free to use this Item in any way that is permitted by the copyright and related rights legislation that applies to your use. For other uses you need to obtain permission from the rights-holder(s).

Persistent Identifier