ABSTRACT
Climate change is one of the crucial global problems of the 21st century. Nations have responded to this challenge by unilateral measures as well as international agreements on reducing greenhouse gas emissions. Important milestones have been the United Nations Framework Convention on Climate Change of 1992, followed by the Kyoto Protocol in 1997. The economic aspects of climate change have been addressed in many publications. The economics of climate change are a common element in every textbook on environmental economics. Policy makers, as well as economists in particular, have been discussing the pros and cons of different policy instruments in the air transport market. From the 1990s, non-governmental organizations and also some political parties have been arguing in favour of higher taxes on aviation in order to limit air transport’s growth and emissions. The chapter also presents an overview of the key concepts discussed in this book.
