This theme focusses mainly on the question, which (climate) policy instruments do we need to achieve the ambitious climate target of the Paris Agreement? The instruments’ potential long-term economic effects, their performance and their interplay are investigated. The broad range of costs and benefits will be assessed against the backdrop of the economic, social and political context to develop efficient solutions.
The development of a (global) carbon market remains the central climate policy proposal. Hence, the performance of the existing emission trading systems will be evaluated. In addition, new mechanisms for carbon markets to, for example, avoid carbon leakage or coordinate carbon prices will be explored.