Well it doesn't, no. IF you have stable government policies, than a carbon tax would be a predictable cost, where a cap would be highly volatile. Obviously if t

Well it doesn't, no. IF you have stable government policies, than a carbon tax would be a predictable cost, where a cap would be highly volatile. Obviously if the policies are changing too, then you can't predict much of anything. "I don't see any objective way of setting such taxes," How about: estimate the economic damage of a marginal kg of CO2 (external cost), and set the tax equal to that? [0] As an order-of-magnitude guess: [total climate change damage] / [total CO2 emitted], both discounted to present dollars. Not an economist. [0] https://en.wikipedia.org/wiki/Pigovian_tax https://en.wikipedia.org/wiki/Pigovian_tax