Flexible global carbon pricing study: A new method to establish the international cooperation on reducing carbon emission

Abstract

Reducing greenhouse gas emissions and confronting climate crisis have become a global consensus. It is of great significance for the international community to form a stable and effective international cooperation mechanism of carbon emissions. Based on Kyoto Protocol, global carbon reduction mechanism for international cooperation is analyzed systematically. Then, this paper constructs new models of price incentives and clean development incentives in order to induce countries to improve carbon price and make global average carbon price equal to the target price. At last, through a predictive example, the impact of global carbon pricing mechanism is studied. The results show that global carbon pricing mechanism could meet the need of flexibility required by carbon emissions cap and trade mechanism, also, appropriate and effective carbon reduction mechanism would not cause higher social costs.