A growing literature suggests that carbon emissions are most efficiently reduced by carbon pricing. There are, however, three challenges that limit our understanding of market-based mechanisms: studies often (a) predict, rather than evaluate effects, (b) show large difference in findings, and...

A growing literature suggests that carbon emissions are most efficiently reduced by carbon pricing. The evidence base on the effectiveness of market-based mechanisms, however, faces three key limitations: studies often (a) predict, rather than evaluate effects, (b) show large difference in...