Market-Based Solutions for Mitigating Climate Change
Provided by: Council on Foreign Relations |Published on: January 27, 2026
Articles/Websites
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Synopsis
This article from the Council on Foreign Relations explains how effective financial incentives can be in changing behavior, focusing on solutions for reducing greenhouse gas emissions.
Students will learn how carbon taxes, subsidies, and cap-and-trade systems can be used to curb greenhouse gas emissions, as well as some policies in the United States that have implemented these market-based solutions.
This resource contains several graphics and visual aides that help students connect to ideas throughout the text.
The article does a great job of explaining these three approaches in a way that is easy to comprehend, even for students relatively new to economics.
Prerequisites
Students should understand the impacts of greenhouse gas emissions on health and climate change.
Differentiation & Implementation
After reading about carbon taxes, teachers can have students pair up to prepare for and act in a mock-debate. One half of students can be climate-conscious politicians arguing for a higher carbon tax, while the other half can act as a politician backed by industry leaders.
Students can research and discuss how policies have changed since the article was last updated.
Students can use evidence from this article to write letters to their representatives, urging them to support fiscal policies that will reduce greenhouse gas emissions.
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About the Partner Provider
CFR Education from the Council on Foreign Relations
CFR Education provides accurate, accessible, authoritative resources that build the knowledge, skills, and perspective high school and higher education students need to understand and engage with today’s most pressing global issues.
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