Economic Traffic Management (ETM) determines an innovative approach to manage application traffic flows in overlay networks. ETM inter-relates traditional mechanisms of network management with economic incentives. To enable a suitable theoretical understanding of this approach, relevant ETM approaches are studied and classified. The key outcome of these investigations shows that a large potential exists for ETM’s applicability in Internet Service Provider (ISP) networks. Therefore, a dedicated architecture for integrating ETM into ISP networks is developed by the EU FP7 SmoothIT project (Simple Economic Management Approaches of Overlay Traffic in Heterogeneous Internet Topologies). This architecture enables the integration of all identified ETM approaches due to its flexible and modular nature.