Nevertheless, this is an important debate, and we have to take the arguments put forward by EME policy-makers seriously. However, the current debate focuses too much today on the negative externalities of domestic monetary policy decisions, and overlooks the fact that global liquidity is closely intertwined with the degree of international risk-sharing.
Economists have the task of making an effective contribution to the evaluation of the effects of existing policies and collaborating in the design of measures based on the available evidence. Carbon taxation and emission quotas have proven to be useful instruments in discouraging the use of fossil fuels.