{
  "id": "tradable-permits",
  "name": "Tradable permits (cap and trade)",
  "unit": "micro",
  "unitName": "Unit 2 · Microeconomics",
  "topic": "Market failure",
  "hl": false,
  "description": "The government caps pollution with a fixed (vertical) supply of permits; the permit price is set by demand. Rising demand or a tighter cap raises the price, increasing the incentive to cut emissions.",
  "keywords": [
    "tradable permits",
    "cap and trade",
    "emissions trading",
    "pollution permits",
    "carbon market",
    "ETS",
    "negative externality",
    "market-based policy"
  ],
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  "params": [
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      "type": "enum",
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          "value": "basic",
          "label": "Permit market"
        },
        {
          "value": "demand",
          "label": "Demand for permits increases"
        },
        {
          "value": "cut",
          "label": "Government reduces the number of permits"
        }
      ]
    },
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      "label": "Size of change",
      "default": 1.8,
      "group": "Shape",
      "type": "number",
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      "max": 2.6,
      "step": 0.1
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      "title": null,
      "xLabel": "Quantity of permits",
      "yLabel": "Price of permits",
      "xRange": [
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      ],
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      ],
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      "default": "Price of permits",
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      "default": "Quantity of permits",
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      "panel": "main"
    },
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      "key": "main.d2",
      "default": "D_2",
      "hint": "Curve",
      "panel": "main"
    },
    {
      "key": "main.s",
      "default": "S_{permits}",
      "hint": "Curve",
      "panel": "main"
    },
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      "key": "main.e1:y",
      "default": "P_1",
      "hint": "Vertical-axis value",
      "panel": "main"
    },
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      "key": "main.e1:x",
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      "label": "D_2"
    },
    {
      "key": "main.s",
      "kind": "curve",
      "label": "S_{permits}"
    },
    {
      "key": "main.shift",
      "kind": "line"
    },
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      "kind": "point"
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