Source: David Friedman’s Substack
by David Friedman
“I believe that global warming is probably real, probably anthropogenic, may well impose net costs. This raises an obvious question: What, if anything, should we do about it? If I were dictator of the world and wished to maximize economic efficiency, the answer would be fairly obvious. Impose a tax on activities that create greenhouse gases designed to reflect the marginal cost they create. That is the standard economic solution, due to Pigou, for problems of negative externalities. Since the tax brings in additional revenue, combine it with a corresponding reduction in whatever taxes currently have the largest adverse effects. I do not, in fact, support carbon taxes. The reason is that I do not believe that, if imposed, they would fit the pattern described above.” (10/02/26)
https://daviddfriedman.substack.com/p/global-warming-carbon-taxes-and-public-e98