"Are we not just as likely to spend the money on carbon friendly products?"
Well that depends...
Apart from definitions of "carbon friendly products" I assume (not read it!) the point of the report is to do with human psychologies and actions and it's pointing out that things are not simple or linear.
A lot of the 'debate' around 'carbon neutral', 'sustainable energy' etc. seems to revolve around the notion of how 'we' (usually the 'affluent' 'west') can do (more of) the same using less oil/coal and (especially) feel less guilty about whatever we do/buy.
It's not that long since carbon trading/offset and turning food growing (or rainforest) land into production for 'bio-fuels' were seen as good/sustainable/way to go.
There are few certainties - 'death and (more) taxes'.
Whatever the views/truths ARE about Global Warming, Peak Oil, population growth, food production/distribution, Sustainable Growth, Development, Capitalism, Consumerism, human rights, equity, fairness etc. etc. there is no 'simple' answer!