This dissertation takes an interdisciplinary view of the Regional Greenhouse Gas Initiative (RGGI) carbon dioxide cap and trade market. Specifically, I analyze both the factors contributing to state participation within the Initiative and the multilevel impacts of the policy on specific outcomes. In the first article, I examine the factors that explain a state’s decision to opt into the voluntary carbon market. I conduct the analysis using both Cox proportional hazards and longitudinal logistic models. The results demonstrate a complex array of factors affecting this decision. First, I find a non-monotonic relationship between per-capita gross state product and the likelihood to join. Results show diminishing effects on the linear term, and positive effects on the quadratic term, creating a relationship between affluence and environmental protection demonstrated by the environmental Kuznets curve. Next, states with more liberal elected state-level officials are more likely to opt into the market. Finally, the likelihood of membership decreases significantly as distance from the policy inventor (New York) increases. In the second article, I identify the impact of participation in the RGGI on state-level carbon emissions from the power sector. I use a longitudinal panel fixed effects OLS model, and use states with deregulated electricity markets for comparison. I find that participation alone does not lead to lower emissions relative to the comparison group. Instead, only member states with more liberal government ideologies will see a diminishing in annual emissions. In the final article, I examine the impacts of participation in the RGGI on the adoption of an array of emission abatement strategies. I identify these impacts using longitudinal panel fixed effects and negative binomial regression models. I find evidence that power plants covered by the RGGI are no more likely to invest in heat-rate improving technology than their comparison group counterparts. I do find evidence that power plants covered by the RGGI are switching away from coal and toward other fuel sources at a higher rate than the comparison group. Finally, I find evidence that power plants covered by the RGGI are no more likely to close coal-fired generating units than the comparison group. I conclude that while the implementation of a cap and trade market is seen by many as a means to attenuate further contributions to global climate change, the impacts of the policy on adaptation strategies within the power sector are weaker than expected.