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Submitted by Vasileios (Vasilis) Panousopoulos on

By pricing carbon emissions indirectly you are pricing free air - oxygen (a free narural good), and this is also dangerous.
In a Walrasian (economic) world pS=0 as long as S>0 and S>D, meaning price multiplied by supplied Quantity (air) equals zero as long as Quantity Supplied (air) is positive and Quanity Demanded (for air) is less than Supply. Putting a price on carbon emissions
in order to keep air as a free good meaning p(S-Sco2)=0, pS-pSco2=0
pS>0 and pSco2<0 then S moves close to D . Fro that point and over it will be silly but it will be infront of the dilemma a) to rename air as a public good (then to impose restriction, regulations , regulated prices, taxes, tariffs and taxes on products etc) or to b) to rename air as market good.........In both cases policy or market failure (are) is granted.....
Professor Stern speaks about market failures (and this is granted since we have to deal with a free good procing one of its basic components: CO2). But we have here a nature failure (climate change is a nature failure not a market failure!)
Therefore is more important governments and international organisations to form Policies that increase (free) air rather to reduce CO2. For example form a) an international tree growth policy, b) reduce emissions from deforestation - protect forest c) focus on energy sector pollution reduction policies - new international electricity generation standards, d) invest in new technologies