Policy interactions reshape the outcomes of carbon pricing policies https://www.nature.com/articles/s41558-026-02578-0 Posted by ILikeNeurons
ILikeNeurons on March 12, 2026 12:40 pm The consensus among [scientists](https://people.uwec.edu/jamelsem/papers/CC_Literature_Web_Share/Science/CC_Science_Perspective_Rosenberg_2010.pdf) and [economists](http://policyintegrity.org/files/publications/ExpertConsensusReport.pdf) on [carbon pricing](https://en.wikipedia.org/wiki/Carbon_price) to mitigate climate change is similar to [the consensus among climatologists](http://climate.nasa.gov/scientific-consensus/) that human activity is responsible for global warming. Putting the price [upstream](https://www.wsj.com/articles/SB10001424127887323611604578396401965799658) where the fossil fuels enter the market makes it simple, easily enforceable, and bureaucratically lean. Returning the revenue as an equitable dividend [offsets any regressive effects of the tax](http://www.nber.org/papers/w9152.pdf) (in fact, [~60% of the public would receive more in dividend than they paid in tax](http://journals.plos.org/plosone/article?id=10.1371/journal.pone.0081648#s7)) and allows for a higher carbon price (which [is what matters for climate mitigation](https://www.worldscientific.com/doi/pdf/10.1142/S201000781840002X)) because [the public isn’t willing to pay anywhere near what’s needed otherwise](https://e360.yale.edu/digest/americans-are-willing-to-pay-177-annually-for-carbon-tax-survey-finds). Enacting a [border tax](http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2026879) would protect domestic businesses from foreign producers not saddled with similar pollution taxes, and also [incentivize those countries](http://ageconsearch.umn.edu/handle/205761) to enact their own. A carbon tax is [widely regarded](https://www.nature.com/articles/s41558-019-0474-0.epdf?author_access_token=tst1A-oZnQ8zUO18wGGPQdRgN0jAjWel9jnR3ZoTv0Nfy3PIgvrwnNXQzIbXH8z1Wkqhm6g5NiMnxMk__ebsKxGQNB0hMf1Vpo-ZiNplSt5LeLyks-Q3sdrpBdfxxHvAfQylqqwqHxgEml7GEGOxaQ%3D%3D) as the single most impactful climate mitigation policy. /r/ClimateOffensive https://citizensclimatelobby.org/join-citizens-climate-lobby/
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The consensus among [scientists](https://people.uwec.edu/jamelsem/papers/CC_Literature_Web_Share/Science/CC_Science_Perspective_Rosenberg_2010.pdf) and [economists](http://policyintegrity.org/files/publications/ExpertConsensusReport.pdf) on [carbon pricing](https://en.wikipedia.org/wiki/Carbon_price) to mitigate climate change is similar to [the consensus among climatologists](http://climate.nasa.gov/scientific-consensus/) that human activity is responsible for global warming. Putting the price [upstream](https://www.wsj.com/articles/SB10001424127887323611604578396401965799658) where the fossil fuels enter the market makes it simple, easily enforceable, and bureaucratically lean. Returning the revenue as an equitable dividend [offsets any regressive effects of the tax](http://www.nber.org/papers/w9152.pdf) (in fact, [~60% of the public would receive more in dividend than they paid in tax](http://journals.plos.org/plosone/article?id=10.1371/journal.pone.0081648#s7)) and allows for a higher carbon price (which [is what matters for climate mitigation](https://www.worldscientific.com/doi/pdf/10.1142/S201000781840002X)) because [the public isn’t willing to pay anywhere near what’s needed otherwise](https://e360.yale.edu/digest/americans-are-willing-to-pay-177-annually-for-carbon-tax-survey-finds). Enacting a [border tax](http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2026879) would protect domestic businesses from foreign producers not saddled with similar pollution taxes, and also [incentivize those countries](http://ageconsearch.umn.edu/handle/205761) to enact their own. A carbon tax is [widely regarded](https://www.nature.com/articles/s41558-019-0474-0.epdf?author_access_token=tst1A-oZnQ8zUO18wGGPQdRgN0jAjWel9jnR3ZoTv0Nfy3PIgvrwnNXQzIbXH8z1Wkqhm6g5NiMnxMk__ebsKxGQNB0hMf1Vpo-ZiNplSt5LeLyks-Q3sdrpBdfxxHvAfQylqqwqHxgEml7GEGOxaQ%3D%3D) as the single most impactful climate mitigation policy.
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