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Thoughts on global warming

In addressing climate change, China has a unique opportunity to assert its rising global leadership role, as well as moral authority, writes George A. Akerlof.

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Let me start with a few statements to indicate where I am coming from.

First, the theory and evidence that I have seen all seems to strongly suggest that human-related emissions of carbon into the atmosphere is causing, and will in the future cause, significant global warming.

Second, this global warming is on such a scale that it will wreak havoc on both poor and rich countries.  It could even make large sections of the earth uninhabitable.

Third, the costs of abatement are large.

Therefore the decision to curtail emissions is a very serious one and it is clear that these decisions will also cause hardship in poor and in rich countries.

Fourth, despite these high costs, the time has passed that policy makers should still be acting on the null hypothesis that global warming will not occur.

Choice of null
 

Here I come to the first use of economics.  It turns out that this point is central to current US policy. As I see it, current US policy is that the Federal Government should do continued research to ascertain the extent of global warming and its future path and the  policy tree is to take future action only if the findings of this research are sufficiently conclusive.

In the event of the findings being sufficiently conclusive,  we should take serious corrective action to curtail our own emissions and also to participate in international treaties regarding abatement of emissions.

An alternative null hypothesis—that global warming is already occurring—could be the basis of our policy. Were that to be the case, this alternative hypothesis would cause our policy to be very different : in this case we should be taking active steps now to curb emissions and to participate in international treaties to curb it.

Which of these two null hypotheses guides our policy should be determined by the relative costs and benefits and the relative probabilities of the two hypotheses.

The losses from failing to address global warming if it does occur are truly enormous. Even more serious, the effects are also irreversible. In contrast, the losses from addressing global warming, if it does not occur or if it is not very serious, are not enormous and the losses from addressing the problem  are only very large. In addition, it seems that the likelihood of global warming with serious impacts on large segments of the planet seems now to be very high.

If we add up the relative economic costs and benefits and weight them by their respective probabilities, that seems to show that we should definitely be acting on the presumption that global warming is going to occur.

The unavoidable conclusion is that the current US administration and the US Congress have made the wrong call.

We should be acting to curb it and we should be engaging in international co-operation to do so. And even those who have very serious doubts about whether global warming is occurring should still believe that we should be taking precautions against it. 

Economic remedy

The second topic that I want to address is how we should fight global warming.

Economic theory gives a simple natural way to fight global warming, which is to have escalating taxes on carbon emissions. There is a simple reason why this is the ideal remedy : carbon emissions into the atmosphere constitute a nuisance to everybody on the planet.

People should be taxed to pay a penalty equal to the value of the nuisance that they cause. In this way people who value their emissions more than the nuisance they cause will make those emissions and they will  pay the tax. People whose emissions are not valued as much as the nuisance they cause will curb them and will not  pay the tax. Thus with such a tax, emissions will be curbed insofar as the nuisance they create exceeds their benefits.

The economics here is as simple and straightforward as economics ever gets. It would be hard to find any economist who would disagree.

It may also be worthwhile noting that this may be one place where economists’ judgments may be different from that of other professionals.   We economists tend to  be fairly optimistic about the effects of prices or taxes on people’s behavior. So the size of the tax necessary to reduce these emissions may be large, but perhaps not extremely large.

The reason for that is that we think that over fairly long periods of time that people are fairly responsive to changes in prices. In addition, there will be substitution of nuclear and other non-carbon forms of electricity generation.

Steve Chu’s talk gave some indication as to how large these taxes would have to be to get important shifts even with current technology to carbon-free generation of electricity.

With a carbon-tax people will switch to smaller and more fuel-efficient methods of transport. With sufficient time for innovation and a tax that is sufficiently high there will be other innovations as well. There are also possible innovations in carbon sequestration.

A further recommendation from standard economics is that there should be large-scale government support for research into new technology that will reduce carbon emissions.

However, this research must be supported by incentives to develop such technology further and put it in place.

But it is important to note that the new technology will not and  cannot be successful unless the appropriate incentives for its use are put into place : you may create the most beautiful inventions, but  unless it pays people to use them, they won’t.

So we need a carbon tax or something like it to provide such incentives.

Finally, because much of the use of energy involves networks of people who are doing the same thing, initial technologies may need some extra push from governmental subsidy and governmental regulations.

Thus the economics of what should be done is fairly simple --  sufficiently simple, in fact,  that it can be easily taught as an application of standard economic principles in a first-year undergraduate course. But it turns out that getting people to follow these economic principles is very difficult indeed.

I have seen this at first hand at Congressional testimony given by my wife, who was the Chair of the Council of Economic Advisers from 1997 to 1999. It was her job to represent the economic case of the Clinton Administration as to why the Congress should support the Kyoto Treaty.

The Congress-people were not willing to vote for this because they felt that the costs of supporting Kyoto were too high relative to the benefits. In a nutshell they were afraid that their constituents would rebel against the increases in the prices that would accompany reductions in carbon emissions called for in the Kyoto Accords.

The moral basis of policy

In retrospect I think that the argument for the carbon tax has been pitched in the wrong way and at the wrong level.

The Clinton Administration framed its argument in terms of costs and benefits, but instead, the issue of global warming needs to be phrased in moral terms. Phrasing it in moral terms  should also be the stance for international agreements.

The morality of it is fairly easy : if somebody does not do anything about global warming, the climate of the earth is likely to change drastically, with severe harm to future generations. Carbon emissions are the cause of this global warming. Therefore it is immoral for any country, any industrial entity, or any person to contribute more than her fair share to this nuisance.

It is like a case of stealing. By adding more carbon to the atmosphere than our fair share, we are taking more than what rightfully belongs to us. We should not feel entitled to that any more than we would feel entitled to enter uninvited into our neighbors’ house and partake of the dinner sitting on the table for their family.

Whether or not we should do that is not a question of costs and benefits and even less should it be a question of our costs and ourbenefits.

It is a question of basic right and wrong.

 

 

Opportunity for China
 

I would like to make a suggestion to the Chinese delegation  regarding the stance that they should take toward global warming. I do not think that you should look to the United States to take the lead before you take your own stance on global warming. China is the rising economic star. China is also  the rising star on the stage of world leadership.

World leadership should be given not to countries because they are rich and powerful. It should be given to countries that have a moral commitment to do what is humanitarian and right.

Global warming is one such area. It is an area where the US especially has abdicated what is right for what is expedient. This is an opportunity, perhaps at not even very great cost, for China to assert its moral authority.

It is a good place to begin the assertion of world leadership that China will increasingly take as this century progresses.


George A. Akerlof is the Koshland Professor of Economics at the University of California, Berkeley and winner in 2001 of the Nobel Prize for Economics. This article is taken from a paper Professor Akerlof delivered to the China/US Climate Change Forum in Berkeley in May 2006.

 

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评论 comments

Default avatar
匿名 | Anonymous

酷气候

中国大陆和香港的学生们正在学习全球变暖的知识。在八中(中国),学生们专注于大气建筑效应的相关课题,他们很不错。这个网站特别好。

climate cool

Students in China and the UK are studying about the global warming. In No.8 middle school(china),the students focus on the topic about the construction effect on the atmosphere, they are reaaly good.
And this website is perfect

Default avatar
匿名 | Anonymous

对农业的影响

精彩的点评。但是否考虑到对农业的影响呢?众所周知,中国是一个以农业为主产业的大国,尽管经济发展的目标已经转向工业,但是也不应因此忽视农业的重要性。

Effects on Agriculture

Good comments.But what about the effects on agriculture?As is known to all, China is a country dominating in agriculture.Though now the economic aim has already turned to indutry, agriculture shouldn't be ignored either

Default avatar
匿名 | Anonymous

能被接受的声明

千真万确,我们心里应该对我们此刻所面临的状况有一个清楚的认识,并知道如何行动来防止不良后果的发生。每当我们消费,每当我们使用塑料袋、一次性用品及使用电力等日常用品的时候,都需要清醒地认知。一天一小步,我们今天就拯救世界。 Chalne

Agreeable Statement

It is very right that we should have an exact notion in our minds that what we are facing at the very moment, and what to do to curtail serious consequence. We need to be self-conscious whenever we consume and use daily stuff like plastic bags, disposable goods, and the usage of eletricity, ect.

One step one day, we can save the world today.

Chalne

Default avatar
匿名 | Anonymous

环境保护从我做起

这切实关系到我们未来的生活,希望大家能够重视起来。做到三点,也就是三个R。
Reduce:减少一次性产品的使用,如一次性筷子,纸杯,纸巾等;
Reuse:重复利用可反复使用的物品;
Recycle:回收并特别加工和处理。特别是含有害物质的产品,如电池,电子产品等,保护环境。

Evironmental protection should starts from details

Environmental issues concern all of our futures. So we should and have to pay much more attention to environmental protection. I suggest three "R". First, Reduce: reducing the use of one-off products, like chopsticks, paper cup and tssue etc; Secondly, Reuse: use the reusable products again; Thirdly, Recycle: recycle and dispose. Especially, the products which bring heavy pollution, like battery, electrical products need to be recycled.

Default avatar
匿名 | Anonymous

邀请:全球海洋与气候变化大会

第三十二届海洋和平大会:变化的海浪 给予青年和妇女权利,促进海洋的生态平衡

时间:2007年11月5-8日 地点:马耳他

气候变化、滨海脆弱性以及濒危的生态系统已经使地球北极、海洋环境以及人类的生存陷入严重危机。由于上述危胁,人类如今正面临当代最为严峻的环境挑战:全球暖化和迫在眉睫的海洋危机。

国际海洋协会第三十二届海洋和平大会,以变化的海浪为主题,开拓创新,给予女性和青年以权利,促进海洋资源的和平及可持续开发,建立健全的海洋管理机制。本次大会将会邀请重要嘉宾,包括政府代表,非政府机构以及教育机构,希望探讨出新的处理方式,有效的解决途径以及切实可行的成果,共同对抗海洋威胁。

大会将围绕三大主题,联系女性、青年和海洋的可持续性,以深入的分组讨论和研讨会为特色。

1. 海洋的现状:目前挑战和未来前景 2. 联合国千年发展目标中妇女和青年的参与 3. 可持续性海洋管理的新团结工会

大会最精彩部分包括:水下电影节
关于海洋和气候变化的妇女核心小组
青年海洋议会
“变化的海浪”运动的发动

我们欢迎您加入这个将于今秋在地中海召开的创新世界大会。更为重要的是,通过参加“变化的海浪”运动,我们邀您一起保护人类海洋遗产,迎接更加美好的明天。
详细信息、最新节目、加盟注册,欢迎登陆网站:www.thewavesofchange.org

Invitation to a Global Conference on Oceans and Climate Change

PACEM IN MARIBUS XXXII: WAVES OF CHANGE CONFERENCE
Empowering youth and women to promote ocean sustainability
When: November 5 – 8, 2007
Where: Malta
Modern threats of climate change, coastal vulnerability and endangered ecosystems have put our arctic and marine environments, as well as our own existence, in great peril. Because of these dangers, we are now confronted with one of the most serious environmental challenges of our time: global warming and an impending ocean crisis.
The International Ocean Institute's 32nd Pacem in Maribus (Peace in the Oceans) conference, Waves of Change , will break new ground by empowering women and youth to promote the peaceful and sustainable use of marine resources and sound ocean governance. The conference will bring together key and influential stakeholders including representatives from government, NGOs and educational institutions to develop new approaches, effective solutions and actionable outcomes at overcoming ocean threats.
The conference will be organized around three-themed tracks with relevance to women, youth and ocean sustainability and will feature in-depth breakout sessions and hands-on workshops:
1. The State of the Ocean: Current Challenges and Future Prospects
2. Involvement of Women and Youth within the UN Millennium Development Goals (MDGs)
3. New Solidarities for Sustainable Ocean Governance
Conference highlights include:
Underwater Film Festival
Women's Caucus on the Oceans and Climate Change
Youth Ocean Parliament
Launching of the Waves of Change Campaign
We welcome you to join us in the heart of the Mediterranean this Fall for this ground-breaking and global conference. More importantly, we invite you to help preserve our ocean heritage by taking part in the Waves of Change towards a better future.
For more information, the latest program and to register, visit: www.thewavesofchange.org.

Default avatar
匿名 | Anonymous

边小事

这就更需要我们从自身做起,从身边小事做起。做为个人而言,我们应该使用环保材料,减少空调使用率,开发出更清洁的汽油以及尾气排放量更低的汽车。

Small changes

This would require us to make changes about our own habit in daily life. As individuals, we should use environmentally-friendly materials, use air-conditioner less frequently, develop greener petroleum and cars which would emit less green house gases.

Default avatar
匿名 | Anonymous

全球变暖

这是一个严肃的问题。

Global warming

It is a serious problem

Default avatar
匿名 | Anonymous

一个不愿面对的真相

刚看了这部电影~很震撼...

全球变暖这样的全球性的问题需要我们地球上的每一个人的努力~

我会把这个电影推荐给身边的同学~

让大家一起来努力

An Inconvinent Truth

I just watched this film, which is a heartquake.

Everyone on this planet must make efforts to face up to the global warming challenge.

I like to suggest my coursemates to watch this documentary. Let's work together to sort out this problem.

Default avatar
匿名 | Anonymous

酷!

这个网站非常好。一直以来我都在找见解这么深刻的网站,这次我很高兴地看到这个网站上的人们有如此的责任感和智慧。说到全球暖化,我希望每个人都能尽自己之力帮助解决这个问题。比如我们最好减少汽车使用,让公交运输系统更为风行。好,今天我就写这些,虽然有专家表示全球暖化的严重性非其他问题所能相比,但是我仍然对此抱积极态度,相信我们的耐心和合作努力能够为地球疗伤。

that's cool

this website really nice. i am looking for a insightful websight for a really long time, this time, i am delighted to see all the people are all responsible and intelligent, as for the issue of global warming, i wish everybody will do their little bit to solve the problem , we'd better reduce the use of cars for example, and let public transportation becomes a trend. al right so much for today, although some experts express their opinion that is there is no equivalents to the problem ,jet i still positively believed that our patiences and joint efforts will heal the wound of the world.

Default avatar
匿名 | Anonymous

排放税和道德问题

这听起来是个好主意,但是在当今法制仍需要改善的中国执行“排放税”政策会十分困难。垃圾分类回收都不能很好的执行(至少在我的城市)。我置疑以道德观为基础的限制二氧化碳排放政策的可行性。

emission tax and the moral issue

It sounds like a good idea, but the execution of this "emission tax" policy will be extremely difficult in current China, when the legilation system still need to be improved.

If we, the Chinese, can't even sort different types of rubbish for recycling (at least in my city). I doubt the restriction of CO2 emission based on "moral value" will work.