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  • How is the U.S. Pricing Carbon? How Could We Price Carbon?

  • Joseph E. Aldy, Dallas Burtraw, Carolyn Fischer, Meredith Fowlie, Roberton C. Williams III, Maureen L. Cropper
  • Journal:
    Journal of Benefit-Cost Analysis / Volume 13 / Issue 3 / Fall 2022
    Published online by Cambridge University Press:
    22 November 2022, pp. 310-334
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  • Economists have for decades recommended that carbon dioxide and other greenhouse gases be taxed – or otherwise priced – to provide incentives for their reduction. The USA does not have a federal carbon tax; however, many state and federal programs to reduce carbon emissions effectively price carbon – for example, through cap-and-trade systems or regulations. There are also programs that subsidize reductions in carbon emissions. At the 2022 meetings of the American Economic Association, the Society for Benefit-Cost Analysis brought together five well-known economists – Joe Aldy, Dallas Burtraw, Carolyn Fischer, Meredith Fowlie, and Rob Williams – to discuss how the USA does, in fact, price carbon and how it could price carbon. Maureen Cropper chaired the panel. This paper summarizes their remarks.