The Australian carbon tax: a step in the right direction but not enough

In this article we argue that the recently legislated carbon tax in Australia is a step in the right direction towards a low-carbon society, but not enough: decarbonizing Australia calls for a radical structural transformation of the economy. Based on past experiences and economic theory, we argue that current climate legislation should be complemented with an additional set of policies aimed at developing new technology that has the capacity to structurally change the economy, including the demand side. We suggest eight policy measures that can be pursued together with the carbon tax to reduce CO2 emissions.