Several scientific societies around the world have stated that the global climate is changing and its effects have already been observed. The results of Nordhaus’ DICE model demonstrate that emission reductions are difficult to achieve without reducing population, living standards, and carbon intensity. The reason why global warming is a troublesome externality is that it is global and that it is a problem of cost/benefits for future generations. As a result, the Kyoto mechanism has failed to significantly reduce emissions and to participate in agreements with many countries. As an issue after the Paris Agreement, in order to avoid the free-rider problem, high levels of carbon prices and tariff frameworks in international trade should be linked to motivate as many countries as possible to join the agreement.
