[chewz]

Lucas got Noble prize for proving that market participants game new rules faster then regulators introduce them.

Pseudo-market solutions in healtcare (pricing procedures with ICD and allowing market participants compete) are currently proved as inefficient. Net gain for market participants but net loss for people and goverment budgets.

So my reservation is for carbon tax as gigantic wealth transfer without real benefits to climate. I am not against urgent action on climate.

[graeme]

Is a tax a regulation in that sense? I’m wary of non-tax responses to climate change for the reasons you suggest, I think they’re easy to game.

But with a tax you can only evade. The income tax still raises revenue and discourages income, even though it can be evaded and often is. I think a carbon tax would similarly raise revenue and discourage carbon, while letting us cut worse taxes like the carbon tax.