Hypothesis for a Risk Cost of Carbon: Revising the Externalities and Ethics of Climate Change

  title={Hypothesis for a Risk Cost of Carbon: Revising the Externalities and Ethics of Climate Change},
  author={Delton B. Chen and Joel van der Beek and John G. Cloud},
  journal={Understanding Risks and Uncertainties in Energy and Climate Policy},
Standard market-based policies for addressing climate change mostly aim to internalize the Social Cost of Carbon (SCC) into the economy with either carbon taxes or cap-and-trade schemes. Standard policies are failing to manage the systemic risk of dangerous-to-catastrophic climate change for a variety of reasons. In this chapter we clarify and expand on a market hypothesis that argues for a second externalized cost of carbon, called the Risk Cost of Carbon (RCC), as the appropriate solution to… 
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    Proceedings of the National Academy of Sciences
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