This research project is to design global emissions trading schemes applicable to the current Kyoto protocol and its successors. The research project will include the following elements: (i) Theoretical model building using the mechanism design approach; (ii) Development of experimental design through the theoretical results; and (iii) Carrying out experiments (trading entities; modality and trading methods; futures markets; liability; dominance; supplementarity). The USA, as the biggest emitter of greenhouse gases, and Japan, with higher marginal reduction costs, are uniquely placed to develop a high performance emissions trading institution. By identifying elements of high performance markets, this research will not only provide benefits to policymakers in the field of emissions trading, but will also contribute to the design of other market-oriented institutions.