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Volume 53, May/June 2018, Number 3 · pp. 135-140

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Shifting Paradigms in Carbon Pricing

Brigitte Knopf, Kerstin Burghaus, Christian Flachsland, Michael Jakob, Nicolas Koch, Ottmar Edenhofer

Carbon pricing is essential to achieve a reduction in global CO2 emissions. A carbon price can either be set directly via a carbon tax (price control) or be achieved through a cap-and-trade system (quantity control). While there has been much debate about the relative merits of each approach, cap-and-trade systems have been favoured in the political arena. In principle, they offer the most straightforward way to achieve a country’s emission reduction target by simply setting the cap at the remaining emission budget. Existing emissions trading schemes (ETSs) can be found in Europe, California and Québec, for example.

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This Intereconomics article is available for free at this page after an embargo period of two years. Reading it before June 2020 is possible via SpringerLink or in the next library.