What can governments do to manage greenhouse gas emissions?
Levi Governments have a wide range of tools at their disposal as they try to promote reductions in emissions from what they otherwise would have been. One wide class of tools that people talk about gets referred to as putting a price on carbon. The idea there is simple. You make activities that produce carbon dioxide emissions more expensive than activities that produce fewer emissions, either through a carbon tax or through a cap and trade system. If it becomes more expensive, relatively speaking, to emit carbon dioxide, people will make economic choices that will have the effect of reducing emissions from what they otherwise would have been. There are challenges here, there are administrative challenges but there are also political challenges, which are inevitable in any situation where you increase the price of doing something for consumers, for producers, for firms. There are a wide range of other tools that can be brought to bear, that more resemble traditional regulation. For exa
