Following the rapid development of carbon markets, little attention has been devoted to what precisely is being traded. Some authors have speculated that carbon can be considered as a form of money (Button; House and Victor). Not only is making money from carbon possible via several market devices but this process has also enabled the construction of carbon as a form of money.

To provides an overall framework for thinking about the construction of carbon markets, we adopt James Der Derian's ‘virtuous war’ theory to develop an argument about carbon as a virtuous commodity. This refers to the close affinity between virtuality and virtue – the technological and the ethical – in the construction of carbon markets.

To investigate the ‘promiscuous history’ of the efficiency of emissions trading markets, I draw from Actor Network Theory and specifically the work of Bruno Latour, highlighting how the commonly made claim to efficiency was constructed as a ‘fact’. I trace the processes, beginning in the early 1970s, that constructed first the inefficiency of command-and-control regulation through the distinction between the means and the ends of regulation, and the conversion of the specific 1970 Clean Air Act regulations into the archetypal form of command-and-control.

Creating a mechanism for reducing emissions from deforestation and degradation (REDD+) in tropical developing countries has become, from 2005 onward, a central element in international climate protection discourse. The goal is to create financial incentives for forest protection by making avoided deforestation a tradable good that can be sold on the carbon market or to government funds. A discourse-analytical perspective on the process of commodification and market creation is developed in order to assess how avoided deforestation is being made tradable.

Pragmatism has recently taken up the ‘practice turn’ in order to overcome the neglect of agency in poststructuralist accounts. To explore potential advantages if such an approach is used for an analysis of carbon markets, it is first asked whether a practice approach could allow us to go beyond the dichotomy of agents vs. structures and thus lead to an understanding of carbon assets as a specific configuration of power and authority.