Impact of Carbon Pricing on Deep Decarbonisation : A Rejoinder to Lilliestam Et Al. (2022)

A review article in WIREs Climate Change by Lilliestam Patt and Bersalli (2021) on the effect of carbon pricing on technological change concluded that there is no evidence for it. We published a short commentary with eight criticisms in Environmental and Resource Economics (van den Bergh and Savin, 2021), followed by a response of Lilliestam et al. (2022). The latter took the form of an article of twenty pages in which they tried to redo and improve their study to dismiss our concerns. The current rejoinder systematically assesses Lilliestam et al. (2022). We find that the authors explicitly or implicitly accept some of the criticisms, while resisting others without convincing evidence or arguments. In addition, they show prejudice and confirmation bias in their responses and revised review of the empirical literature, among others, through using ambiguous and ad-hoc selection and evaluation criteria. We conclude that there is considerable evidence that carbon pricing, despite imperfect implementation and low price rates, has contributed to technological innovation