To Market, to Market: The Social Foundations of Carbon Trading in Brazil and India
2026-06-09
Carbon markets are a leading global policy response to climate change. This article introduces a framework for analyzing carbon markets grounded in economic sociology. The framework centers on the cognitive, network, and institutional foundations of markets. A comparative case analysis of the outcomes of the Clean Development Mechanism (CDM) in the Brazilian and Indian sugar industries illustrates how the framework can guide research. Sugar mills in both countries were governed by the same international CDM rules and operated in broadly similar political-economic contexts. However, a combined quantitative and qualitative analysis of sugar mill participation in the CDM reveals different dynamics at work in the Brazilian and Indian CDM markets. Owing to the cognitive complexity of the CDM, carbon market intermediaries were pivotal role in recruiting sugar mills to the CDM market. As key nodes in carbon market networks, their strategies and operations were shaped by the distinct national climate institutions of Brazil and India, producing markedly different market outcomes.