The Promise and Problems of Pricing Carbon: Theory and Experience
AbstractBecause of the global commons nature of climate change, international cooperation among nations will likely be necessary for meaningful action at the global level. At the same time, it will inevitably be up to the actions of sovereign nations to put in place policies that bring about meaningful reductions in the emissions of greenhouse gases. Due to the ubiquity and diversity of emissions of greenhouse gases in most economies, as well as the variation in abatement costs among individual sources, conventional environmental policy approaches, such as uniform technology and performance standards, are unlikely to be sufficient to the task. Therefore, attention has increasingly turned to market-based instruments in the form of carbon-pricing mechanisms. We examine the opportunities and challenges associated with the major options for carbon pricing: carbon taxes, cap-and-trade, emission reduction credits, clean energy standards, and fossil fuel subsidy reductions.
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Bibliographic InfoPaper provided by Fondazione Eni Enrico Mattei in its series Working Papers with number 2011.82.
Date of creation: Nov 2011
Date of revision:
: Global Climate Change; Market-Based Instruments; Carbon Pricing; Carbon Taxes; Cap-and-Trade; Emission Reduction Credits; Energy Subsidies; Clean Energy Standards;
Other versions of this item:
- Aldy, Joseph E. & Stavins, Robert N., 2011. "The Promise and Problems of Pricing Carbon: Theory and Experience," Working Paper Series rwp11-041, Harvard University, John F. Kennedy School of Government.
- Stavins, Robert Norman & Aldy, Joseph Edgar, 2011. "The Promise and Problems of Pricing Carbon: Theory and Experience," Scholarly Articles 5347069, Harvard Kennedy School of Government.
- Joseph E. Aldy & Robert Stavins, 2011. "The Promise and Problems of Pricing Carbon: Theory and Experience," NBER Working Papers 17569, National Bureau of Economic Research, Inc.
- Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters
- Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
- Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General
- Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
This paper has been announced in the following NEP Reports:
- NEP-AGR-2012-02-01 (Agricultural Economics)
- NEP-ALL-2012-02-01 (All new papers)
- NEP-ENE-2012-02-01 (Energy Economics)
- NEP-ENV-2012-02-01 (Environmental Economics)
- NEP-REG-2012-02-01 (Regulation)
- NEP-RES-2012-02-01 (Resource Economics)
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