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Purpose

Research on the carbon markets has gained momentum over the past decade because of growing popularity among academicians and practitioners. Despite great efforts, academic understanding of carbon markets is limited and dispersed. This study aims to synthesize knowledge, delve into the current dynamics, identify key research streams and suggest a road map for future research in this domain. This study addresses this void by providing the first bibliometric literature review of the most prominent studies on carbon markets.

Design/methodology/approach

To better understand this enigmatic topic and enhance scientific research, this study integrates a quantitative bibliometric analysis with a qualitative content analysis of scholarly contributions from 2005 to 2023.

Findings

The bibliometric analysis yields deeper insights into year-wise publications, the most prominent articles, authors and main outlets for publication within this domain. Moreover, the content analysis of the top 100 influential articles unveils the current research hotspots and classifies the literature into six major themes: risk and volatility dynamics; market efficiency; news effects; determinants of carbon prices; carbon market integration with financial markets; and herding behavior.

Practical implications

The findings of this study can be used by researchers, practitioners, regulators, policymakers and investors to enhance their understanding of carbon price dynamics and make more informed decisions pertaining to investments and policymaking.

Originality/value

This study sets itself apart by using a mixed-methods approach, combining bibliometric and content analysis to yield comprehensive and reliable results. Overall, the findings of this study provide a deep understanding of the carbon market as a burgeoning financial market.

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