CLIMATE

Shifting Paradigms in Carbon Pricing

By Ottmar Edenhofer, Brigitte Knopf et al., Mercator Research Institute for Climate Change

BY

FORUM NEW ECONOMY

PUBLISHED

1. NOVEMBER 2019

READING TIME

1 MIN.

The authors stress that carbon prices are a cost-efficient way to cut emissions, but that emission trading schemes have failed to generate high enough prices. Carbon prices also need to be augmented by a range of other policies.

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ABOUT CLIMATE

KNOWLEDGE BASE

During the high point of market orthodoxy, economists argued that the most 'efficient' way to combat climate change was to simply let markets determine the price of carbon emissions. Today, there is a growing consensus that prices need to be regulated and that a carbon price on its own might not be enough.

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