1. Carbon Pricing for Inclusive Prosperity: The Role of Public Support
- Author:
- David Klenert and Linus Mattauch
- Publication Date:
- 08-2019
- Content Type:
- Policy Brief
- Institution:
- Economics for Inclusive Prosperity (EfIP)
- Abstract:
- It is common knowledge among economists that the most efficient instrument to mitigate climate change is a price on carbon. However, current carbon prices around the world are too low to reach global climate targets. This essay assesses the difficulties in designing successful carbon pricing reforms. It discusses how to overcome these difficulties by combining traditional public economics lessons with findings from behavioral and political science. We stress insights from public finance about the “second-best” nature of pricing carbon reforms. Further, we highlight how framing a carbon tax reform around tangible benefits can enhance political support. Finally, we explain how certain countries were successful at introducing high carbon prices and what can be learned from these cases for making progress with climate change mitigation.
- Topic:
- Climate Change, Economics, Science and Technology, Natural Resources, Global Warming, Green Technology, and Economic Policy
- Political Geography:
- United States