Tuesday, July 24, 2007

Becker on Carbon Taxes

Gary Becker and Richard Posner confirm their membership in the Pigou Club. Here is Becker:
A tax on carbon emissions from business and household production would not only help reduce global warming--by how much is still controversial--but it would also lower the world prices of these fuels through reducing the demand for fossil fuels. Lower prices would cut the revenues received by Middle Eastern states from the sale of oil and natural gas. This is why a carbon tax receives support from many environmentalists and national security advocates.