Cap and trade strategies are also referred to as Emissions Trading strategies. These are designed to offer economic incentives for the reduction of emissions of pollutants. A stake-holding authority (government or international institution) will set a reasonable target for maximum emissions over a particular area (county, state, country, region, etc.) this is the “cap” of acceptable emission amounts. Entities that produce emissions are given a certain number of emissions allowances (also called credits). If one company produces more than their share of emissions, they may buy credits from companies that emit less. This practice allows the area to meet cap goals.