The Flaws of Free-Market Solutions for Climate Change Prevention and Their Homology to Finance-Driven Capitalism

Max Koch
Additional contact information
Max Koch: Lund University

Chapter 14 in Capitalism and Climate Change, 2012, pp 167-177 from Palgrave Macmillan

Abstract: Abstract After the previous discussion of the neoclassical proponents of carbon trading, this final chapter is dedicated to the problematic and counterproductive aspects of this trading. The experience generated to date by available empirical data on actual carbon-trading schemes has already questioned the contribution of these schemes to climate change mitigation. Furthermore, we have noted some of the flaws in carbon trading using the EU ETS — for instance, the over-allocation of certificates and windfall profits for energy companies (see Chapter 13). Against this backdrop, some observers have even dismissed, ironically, the Kyoto Protocol’s ‘flexible mechanisms’ as ‘hot air’, while apologists argue that both Kyoto and the EU ETS are to be understood as ‘learning processes’ on the road towards ‘more universal and rigorous formulae’ (Giddens, 2009, p. 189). We will now discuss whether the flaws and problems of carbon trading systems should be viewed as the ‘teething troubles’ of an emerging policy instrument or whether they are endemic and likely to persist. I will comment on issues such as the over-allocation of certificates and windfalls for greenhouse gas emitting companies, self-reporting of CO2 emissions, carbon price volatility, offsetting or CO2 reduction duties, the problem of ‘additionality’, geographic distribution, size and content of clean development mechanism (CDM) projects, the bureaucracy and the cost element of carbon-trading schemes and their possibly innovative effect.

Keywords: Clean Development Mechanism; Emission Trading; Clean Development Mechanism Project; Carbon Market; Credit Crunch (search for similar items in EconPapers)
Date: 2012
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-0-230-35508-8_15

Ordering information: This item can be ordered from
http://www.palgrave.com/9780230355088

DOI: 10.1057/9780230355088_15

Access Statistics for this chapter

More chapters in Palgrave Macmillan Books from Palgrave Macmillan
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().