The Economics of Global Warming

The overwhelming majority of climate scientists agree that not only is human-caused global warming very real, mankind is facing a situation that could actually end up being apocalyptic. Before we can deal with trying to solve this problem we have to come up with an intellectual consensus on a couple of issues:

First, how much will all this cost, i.e., will the cost be manageable, or will it be so expensive that it will stop all development, thus reducing the developed economies back to lifestyle of the dark ages?

Second, China is now a larger polluter than the U.S.A., and will continue to get even more important to the solution to global warming than America. India is coming along too. So how can mankind implement policies which will have worldwide impact, not just in the economies of America and Europe?

Transportation is not the biggest part of the problem. Coal is. Whether in America, Europe, or China the burning of coal to produce electricity is growing very rapidly. This creates carbon dioxide, one of the greenhouse gasses. And “clean coal” is just a fantasy marketing phrase which bears almost no relationship to reality.

The Nobel prize winning economist Paul Krugman has written an excellent paper which in a very straightforward fashion looks at this problem. It should be required reading for all college economics students, and all science and engineering students.


LINK: http://www.nytimes.com/2010/04/11/magazine/11Economy-t.html?pagewanted=all

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