Reviews the economics literature of market-based environmental regulations and design issues for environmental taxes and cap-and-trade systems. It begins by reviewing the economics literature on the theory of market-based environmental regulations. It then goes on to cover design issues for environmental taxes and cap-and-trade systems.Market-based Approaches to Environmental Regulation also discusses the U.S. experience with a number of regulatory approaches that are commonly characterized as market-based and describes the mix of market and non-market instruments that characterize these policies. It will be of interest to all researchers and practitioners in the field of environmental regulation.