Why would the government allow companies to buy and sell permits that allow companies to emit specified amounts of pollutants?

Question

Quizplus · Accepted Answer

Allowing companies to buy and sell emissions permits ensures that emissions reductions are carried out by firms that can do so at a lower cost than others. This helps to reduce the overall cost of reducing emissions and provides an economic incentive for firms to reduce their emissions. It also creates a market for emissions permits, which encourages more efficient allocation of resources and reduces the likelihood of bias in the allocation of emissions rights. It does not necessarily eliminate the costs of any externalities, but it can help to reduce the negative effects of externalities.

Why Would the Government Allow Companies to Buy and Sell