The diffusion of carbon taxes and emission trading schemes: the emerging norm of carbon pricing

Abstract

As the evidence of global warming amounts, the demand increases for effective policy responses that can counter a dangerous rise in the global temperature. Here, we demonstrate and explain the spread of one such policy: carbon pricing. By employing the concept of policy diffusion, we show that the two carbon pricing policies–carbon taxes and emission trading schemes–have diffused as a result, not of independent policy choices in different states, but of an interdependent process of states learning from and emulating each other under the influence of international organisations. In this way, carbon pricing has transitioned from being a policy employed only by pioneer countries to becoming a global norm to which every responsible state is expected to conform.