I feel like Noah’s argument implies that states won’t incur any costs to reduce CO2 emissions, which is wrong. IMO, the argument for a Pigouvian tax in this context is that for a given amount of CO2 reduction that you want, the tax is a cheaper way of getting it than e.g. regulating which technologies people can or can’t use.
IMO, the argument for a Pigouvian tax in this context is that for a given amount of CO2 reduction that you want, the tax is a cheaper way of getting it
Since the argument about internalizing externalities fails in this case (as the tax is local), arguably the best way of modeling the problem is viewing each community as having some degree of altruism. Then, just as EAs might say “donate 10% of your income in a cause neutral way” the argument is that communities should just spend their “climate change money” reducing carbon in the way that’s most effective, even if it’s not rationalized in some sort of cost internalization framework. And Noah pointed out in his article (though not in the part I quoted) that R&D spending is probably more effective than imposing carbon taxes.
I feel like Noah’s argument implies that states won’t incur any costs to reduce CO2 emissions, which is wrong. IMO, the argument for a Pigouvian tax in this context is that for a given amount of CO2 reduction that you want, the tax is a cheaper way of getting it than e.g. regulating which technologies people can or can’t use.
Since the argument about internalizing externalities fails in this case (as the tax is local), arguably the best way of modeling the problem is viewing each community as having some degree of altruism. Then, just as EAs might say “donate 10% of your income in a cause neutral way” the argument is that communities should just spend their “climate change money” reducing carbon in the way that’s most effective, even if it’s not rationalized in some sort of cost internalization framework. And Noah pointed out in his article (though not in the part I quoted) that R&D spending is probably more effective than imposing carbon taxes.