Argument: Emissions trading has govt not markets set cap

Issue Report: Carbon emissions trading


“Is carbon trading a market mechanism?”: “There appears to be a misconception among many ‘lay economists’ that carbon trading is a ‘market mechanism’ while carbon taxes are not. However, government control of the quantity of an item being sold is no more of a market based mechanism than government control of the price. Where it counts, carbon taxes make far better use of market forces than carbon trading schemes.”