Theory and Practice of Carbon Emission Trading: The Case of the EU ETS

This chapter deals with the procedural aspects by which the — rather modest — goals of the Kyoto protocol are to be achieved. Generally the choice of one certain policy path from a range of options is not independent of wider political and societal debates and dominant ideologies. The spread of neoliberal ideas and solutions from a tiny circle of economists in the Mont Pelerin Society to a largely undisputed worldview is a good example (see Chapter 8). Trading systems were integrated worldwide, property rights systems were restructured and socio-economic regulation facilitated transnational corporate activity weakening the regulatory power of national corporate actors. Developed in well-funded think tanks and business schools across the world, the neoliberal perspective proposed the transformation of a range of public goods into privately held commodities. These served as investment opportunities for the liquid capital that was accumulated at an unprecedented extent in finance-driven capitalism. At the height of this transition, neoliberalism indeed took the character of a new pensée unique (Bourdieu) and was not only applied to economic regulation, but also to other fields, including housing and pension policies. Environmental policies, and the Kyoto procedures in particular, constitute no exception to this rule, as they followed arguments first developed by Ronald Coase in the 1960s.1