First: I've become slightly less tech-nitwit and found out how to put this thing onto BLOGLOVIN'. So go on, click the button on the top of this page!
Today's post is on a topic I recently got interested in, because of a great lecture in our UCL course 'Politics of Climate Change', by Dr. Sam Randalls. I'll be talking about the economics of climate change - not cold specific, but so interesting I want to ramble on about it for a bit.
I'm not used to thinking of climate change within an economic framework. I am a scientist (or rather hope to be able to call myself one, in some far-away future), so the term 'climate change' makes me think: GCM simulations, glacier mass balance, orbital forcing, temperature trends and endless hours looking for the reason the matlab coding for my model run won't work.
Aha, a cliché picture. Appropriate nonetheless.
This particular course is more alpha/gamma than beta based and includes master's students from many different programmes, among which Environment, science and society, Aquatic Science and various ones from the politics and economics departments. Many of the students in the course have much less specific knowledge of climate change than us, but know much more about policy than the MSc. Climate Change people do. Many of them also consider Climate Change a global challenge of secondary or tertiary importance compared to other challenges, because they are more focused on e.g. economic development in the global South.
Because of the interactive group discussion component of the class, this makes for interesting but sometimes frustrating discussions, because the differences in framing the problem are often so large.
The economic framework introduced in the lecture only emphasized to me the difficulty of climate change mitigation policy. Also, it was another confrontation with how many policy makers but also fellow students don't seem to understand the urgency of the issue at hand. Again. A matter of framework and opinion.
Here is a quote from the UN Framework Convention Article 3:
“The Parties should take precautionary measures to anticipate, prevent or minimize the causes of climate change and mitigate its adverse effects. Where there are threats of serious or irreversible damage, lack of full scientific certainty should not be used as a reason for postponing such measures, taking into account that policies and measures to deal with climate change should be cost-effective so as to ensure global benefits at the lowest possible cost. To achieve this, such policies and measures should take into account different socio-economic contexts, be comprehensive, cover all relevant sources, sinks and reservoirs of greenhouse gases and adaptation, and comprise all economic sectors.”
Climate change has thus become an issue that by economists is weighed by cost/benefit principles. The Stern review is seen as the absolute document in this area; a cost-benefit analysis with ethical input, the second of which is now in progress (Randalls, 2014). In my head, it's the economic equivalent of the IPCC reports (any thoughts on this?).
Cost-benefit analyses regarding climate change have been controversial since they exist, and very understandably so. They either focus on a specific goal derived from science - often, 2 degrees C as a "climate change limit" - or look for an optimal amount of climate change, where it e.g. improves Siberian agriculture to an extent that it is economically beneficial.
So what are the main issues at hand? From what I gathered from lectures and readings:
- The climate does not change homogeneously across the planet. Siberia suddenly being viable for agriculture might mean sacrificing a few islands in the Pacific or the Dutch shoreline and having 'Amersfoort aan Zee'. The same goes for glaciers and ecosystems that will vanish forever. We can roughly calculate the economic benefit of a warmer climate in e.g. Scandinavia. But what is the cost of losing Alpine glaciers for ever, or the entire species of Polar Bears? In short: how to put a price on this? How to compare the cost and benefit here?
- When will it be too late? For many ecosystems or parts of the hydrological system, it is already irreversibly too late. "Waiting for more evidence" as many economists have been recommending for decades, will eventually lead to mitigation costs that are unbearable. Also; economists are often judged as climate-skeptics. Agree/disagree?
- How much can we put on future generations? How many of the inevitable mitigation strategies necessary can we burden next generations with? This again depends on economic projections: will they have the resources to take on this burden? To make a highly dramatic statement: with what 'climate debt' do you want your grandkids to come into the world?
Finally, what are the viable economic strategies for mitigation? There are two: carbon markets (cap-and-trade and project based) and carbon taxes. Implementation: the issue with free trade undermining the benefits of a carbon market and the USA's full-on tantrum when it comes to carbon taxes. Also, these strategies will have an effect on the global South, who (understandably) argue for our moral responsibility to let them develop.
Conclusion: DIFFICULT. Hugely interesting, terribly depressing, maybe even more so than my science-side-of-things-courses. But I hope to learn more, because policy is something we can't conveniently shove aside as an issue that doesn't concern scientists.
Please share your opinions, points of view, questions and ideas for future topics with me. I appreciate them!
Cost-benefit analyses regarding climate change have been controversial since they exist, and very understandably so. They either focus on a specific goal derived from science - often, 2 degrees C as a "climate change limit" - or look for an optimal amount of climate change, where it e.g. improves Siberian agriculture to an extent that it is economically beneficial.
So what are the main issues at hand? From what I gathered from lectures and readings:
- The climate does not change homogeneously across the planet. Siberia suddenly being viable for agriculture might mean sacrificing a few islands in the Pacific or the Dutch shoreline and having 'Amersfoort aan Zee'. The same goes for glaciers and ecosystems that will vanish forever. We can roughly calculate the economic benefit of a warmer climate in e.g. Scandinavia. But what is the cost of losing Alpine glaciers for ever, or the entire species of Polar Bears? In short: how to put a price on this? How to compare the cost and benefit here?
- When will it be too late? For many ecosystems or parts of the hydrological system, it is already irreversibly too late. "Waiting for more evidence" as many economists have been recommending for decades, will eventually lead to mitigation costs that are unbearable. Also; economists are often judged as climate-skeptics. Agree/disagree?
- How much can we put on future generations? How many of the inevitable mitigation strategies necessary can we burden next generations with? This again depends on economic projections: will they have the resources to take on this burden? To make a highly dramatic statement: with what 'climate debt' do you want your grandkids to come into the world?
Finally, what are the viable economic strategies for mitigation? There are two: carbon markets (cap-and-trade and project based) and carbon taxes. Implementation: the issue with free trade undermining the benefits of a carbon market and the USA's full-on tantrum when it comes to carbon taxes. Also, these strategies will have an effect on the global South, who (understandably) argue for our moral responsibility to let them develop.
Conclusion: DIFFICULT. Hugely interesting, terribly depressing, maybe even more so than my science-side-of-things-courses. But I hope to learn more, because policy is something we can't conveniently shove aside as an issue that doesn't concern scientists.
Please share your opinions, points of view, questions and ideas for future topics with me. I appreciate them!
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