Nobel Economist Nordhaus Proposes Import Tariffs to Enforce National Climate Action – The Energy Mix
Nordhaus says, “The key to an effective climate treaty is to change the architecture, from a voluntary agreement to one with strong incentives to participate,” in the form of a voluntary “club” whose members derive mutual benefit by sharing the cost of whatever they’ve set out to do.
“There are two key features of the Climate Club that would distinguish it from previous efforts,” Nordhaus writes. “The first is that participating countries would agree to undertake harmonized emission reductions designed to meet a climate objective (such as a 2.0°C temperature limit). The second and critical difference is that nations that do not participate or do not meet their obligations would incur penalties,” based on an international carbon price that would become “the focal provision of the agreement”.