Why Emissions Pricing Can’t Do It Alone





environmental economics, emissions trading, climate policy, climate justice, just transitions


This article explores whether emissions pricing is sufficient to achieve the low-emissions transition in Aotearoa New Zealand. It draws on a critical review of the international literature on emissions pricing, policy interactions and political economy to make three broad arguments. First, that emissions pricing alone cannot be expected to induce the necessary levels of behaviour change and technological transition in the urgent time frame required. Second, non-pricing policies can deliver emissions reductions, even within the context of emissions trading under a volume cap. Third, even if emissions pricing could induce sufficient change, there are political economy constraints on reaching the adequate price in a feasible and equitable way. Consequently, we argue that the weight of evidence lies with utilising emissions pricing as part of a policy mix.


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Author Biographies

David Hall, Auckland University of Technology

David Hall is a senior lecturer in the School of Social Sciences and Public Policy, AUT University, and founding director of Mōhio’s Climate Innovation Lab (www.mohio.co).

Robert McLachlan, Massey University

Robert McLachlan is a distinguished professor in the School of Fundamental Sciences, Massey University, and writes on climate and environmental issues at planetaryecology.org and in other media.