Markets for Anthropogenic Carbon Within the Larger Carbon Cycle

Severin Borenstein

No 16104, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Human activity has disrupted the natural balance of greenhouse gases in the atmosphere and is causing climate change. Burning fossil fuels and deforestation result directly in about 9 gigatons of carbon (GtC) emissions per year against the backdrop of the natural carbon flux -- emission and uptake -- of about 210 GtC per year to and from oceans, vegetation, soils and the atmosphere. But scientific research now indicates that humans are also impacting the natural carbon cycle through less-direct, but very important, mechanisms that are more difficult to monitor and control. I explore the challenges this presents to market or regulatory mechanisms that might be used to reduce greenhouse gases: scientific uncertainty about these indirect processes, pricing heterogeneous impacts of similar human behaviors, and the difficulty of assigning property rights to a far larger set of activities than has previously been contemplated. While this does not undermine arguments for market mechanisms to control direct anthropogenic release of greenhouse gases, it suggests that more research is needed to determine how and whether these mechanisms can be extended to address indirect human impacts.

JEL-codes: H23 Q54 (search for similar items in EconPapers)
Date: 2010-06
New Economics Papers: this item is included in nep-ene, nep-env and nep-reg
Note: EEE
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Citations: View citations in EconPapers (4)

Published as Markets for Anthropogenic Carbon within the Larger Carbon Cycle , Severin Borenstein. in The Design and Implementation of US Climate Policy , Fullerton and Wolfram. 2012

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Chapter: Markets for Anthropogenic Carbon within the Larger Carbon Cycle (2011)
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