'. . . the book is technical but engaging. It has the potential to help those scholars with little background in climate change policy deal with its complex politics. It is likely to be of interest to researchers in environmental sciences and climate change, and those policymakers and practitioners responsible for studying, designing and implementing AIJ and CDM projects.'- Esteve Corbera-Elizalde, Environmental Politics'The main advantage of this book is that it provides a bird's eye view of the complex environmental issues involved in devising a pragmatic climate policy based on flexible instruments. It should be a must-read for students of resource economics as well as policy makers in both developed and developing countries. Students in other fields such as chemical engineering and political science also would benefit from this book as it will serve as an excellent springboard for expanded analysis into more in-depth directions. The main message of this book is that in dealing with the environment, there is no alternative to cooperation among the different countries. How to achieve a consensus among the varied conflicting national and local interests is still an elusive goal. The book eloquently analyzes the conflicting issues involved in reaching a consensus at the intra- and international levels. By spelling out the logic, or lack of it, behind the positions of the various parties, an important step has been taken on the rocky road to achieving a meaningful consensus.'- Khairy Tourk, The Journal of Energy and Development'. . . this is a valuable offering useful starting points for discussion of implementing climate change policy in developing countries.'- Tim Forsyth, Progress in Development Studies Industrialized countries strive to fulfil at least part of their obligation to reduce greenhouse gases by investing in projects in developing countries rather than at home. Developing countries have been rather critical of this idea. This book outlines the development of the international negotiations on the subject and analyses different design options for the Clean Development Mechanism (CDM), taking into account the interests of various groups, especially host countries. Two case studies - one on a renewable energy project in Indonesia and another on Costa Rican climate policy - show the problems that are likely to be encountered by CDM and illustrate the importance of active host country involvement. The authors discuss the problems that will be addressed by forthcoming negotiation rounds and propose practical solutions for the CDM including baseline-setting, institutional structure and credit sharing. Moreover, a long-term view on linking climate and development policy is taken to achieve an equitable allocation of emission rights.