The Kyoto Protocol entered into force in 2005, symbolizing the global response to climate change has entered a new era. Under the Kyoto Protocol, to build domestic carbon emissions trading scheme and to link it to Kyoto mechanism has become a country’s primary carbon reduction policy worldwide. The global emissions trading market has created remarkable trading volume and value. The objectives of this study are:
(1) to collect the information of carbon trading schemes in the European Union, the United Kingdom, Australia, the United States, and Japan. And to study the linkage of the above systems to the joint implementation (JI) and clean development mechanism (CDM) and to analyze its effectiveness, advantages and disadvantages;
(2) to clarify the advantages and disadvantages of the carbon emission reductions economic tools (such as carbon taxes and cap-and-trade), and their inter-relatedness and competition for government legislation;
(3) to propose the establishment of domestic emissions trading market. Finally, we will give conclusions and policy suggestions.