Climate experts worldwide disagree on best carbon pricing policies

The discussion around carbon dioxide pricing has become central to climate policy. Governments, industries, and citizens all feel its impact, but few experts directly influence the public debate.

That makes it difficult to know if specialists worldwide actually agree on how best to design these policies.

To bring clarity, Professor Frikk Nesje from the University of Copenhagen, along with colleagues from Germany and Switzerland, surveyed more than 400 climate policy experts. The survey is now the largest of its kind worldwide.

No single universal solution

The team’s questions spanned critical areas: Should countries prefer carbon taxes or trading schemes? Should border carbon adjustments apply to global trade? And how should revenue from these policies be used?

The findings reveal no single universal solution. Expert recommendations varied widely, influenced by geography, economic development, and academic discipline.

“Our goal has been to provide decision-makers with a solid knowledge base so that they can tailor climate policies that combine environmental effectiveness with economic efficiency and fairness, regardless of where in the world they are to be implemented,” said Professor Nesje.

“This is to ensure that climate policy both works and is adopted.”

Carbon pricing and national circumstances

The results show that experts lean more toward carbon taxes than trading schemes like the European Union Emissions Trading System. Twice as many specialists favored taxation overall. Yet the global picture is not so straightforward.

Professor Nesje explained that wealthier nations like the United States and Denmark tend to favor tax-based approaches.

In contrast, opinions in lower-income countries are more divided. Many experts there support quota trading systems instead. They often see quotas as easier to establish and more practical than introducing new taxes.

Another possible reason, Nesje added, is that quota systems can allow revenue to be transferred or shared between countries, offering additional flexibility.

This difference highlights how national circumstances shape the feasibility of certain climate policies.

Support for carbon adjustment

Perhaps the strongest agreement appeared in attitudes toward border carbon adjustment. A striking 74 percent of experts, regardless of background, endorsed the idea.

The mechanism would impose taxes on imports equal to the importing country’s carbon tax and compensate exports for their carbon intensity.

“Border carbon adjustment has clearly become a key element in the discussion on how to avoid distortion of competitiveness and CO₂ leakage in connection with climate policy. And it is remarkable how broad the support is, considering the legal and technical challenges associated with introducing border carbon adjustment,” said Nesje.

This approach is not just theoretical. The European Union is already embedding it into law through the Carbon Border Adjustment Mechanism.

The use of carbon pricing revenue

The survey revealed sharp divides when it came to the use of carbon pricing revenues. The most popular choice among experts was investing in green research and development.

Another widely supported option was direct transfers to households most affected by climate costs.

However, experts were far less enthusiastic about paying out fixed amounts directly to all households, despite this being common in political debates in countries like the United States.

“Here we can see that the experts’ professional backgrounds play a particularly important role: economists typically recommend measures aimed at economic efficiency, such as reducing distortionary taxes or transfers of money to households,” said Nesje.

“Conversely, experts from other professional groups are much more likely to suggest that the money should be spent on public investments in, for example, green technology.”

According to Professor Nesje, this difference reflects a classic divide between economic theory and political realism. “Both perspectives are important if you want to design policies that both work and get passed.”

Survey on carbon pricing

The survey represents voices from across the globe. More than 400 academic experts were included, selected on the basis of their published research in recognized scientific journals.

Participants spanned diverse fields, from economics and political science to environmental research and law.

The experts were asked to assess and prioritize multiple policy tools, including the balance between carbon taxes and quota trading.

The results are published in the journal Environmental and Resource Economics.

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