Anyway I posted this here because I think it somewhat resembles the policy of buying and closing coal mines. You’re deliberately creating scarcity. Since there are losers when you do that, policymakers might respond. I think creating scarcity in carbon rights is more efficient and much more easy to implement than creating scarcity in coal, but indeed suffers from some of the same drawbacks.
there’s some endongeneity in the policy though—policymakers probably respond to that kind of activity, especially if it happens at scale.
Anyway I posted this here because I think it somewhat resembles the policy of buying and closing coal mines. You’re deliberately creating scarcity. Since there are losers when you do that, policymakers might respond. I think creating scarcity in carbon rights is more efficient and much more easy to implement than creating scarcity in coal, but indeed suffers from some of the same drawbacks.
Possibly, in the medium term. To counter that, you might want to support groups who lobby for lower carbon scheme ceilings as well.