Making an argument broadly accepted among economists, Sita Slavov, my colleague at the American Enterprise Institute, recently wrote that a carbon tax “set to reflect the spillover costs of carbon emissions” would be a policy more efficient than such interventions as light-bulb bans and energy consumption standards for appliances, sometimes called “command-and-control” policies. The tax would allow consumers to reduce the emission of greenhouse gases (GHG) attendant upon their energy consumption patterns in ways that minimize the costs of doing so. Bans and performance standards, on the other hand, allow for far less flexibility, and thus would achieve a given GHG reduction at a cost higher than necessary.
Read Full Article »
