How to think about political risk in carbon markets: Why you should look to the median voter, and stop worrying about politicians

All commodity markets are political, you just need to understand the game that’s being played.

Whether it is oil, sugar or rice or something else, government intervention isn’t too far away.

Environmental markets such as carbon are a particular type of political construction in which artificial scarcity is created through regulation. And so the response from some investors when observing…