The Carbon Market: Chasing Away Jobs and Capital without Reducing GHGs
Economic note showing how imposing a price on carbon through cap-and-trade will have a negligible effect on GHG emissions, but a significant impact on the economy
A carbon market, like a carbon tax, aims to modify behaviours in order to reduce GHG emissions by setting a price for them. Although such mechanisms are regularly mentioned in the news, their economic consequences are less often discussed, to say nothing of their effectiveness. Does imposing a price on carbon always reduce emissions, or does it instead displace them, along with the accompanying economic activity? In the two scenarios examined here, the effect on GHG emissions would be negligible, but the economic impact would be significant.
13 June 2018June 13, 2018