environmental economics
Low-Hanging Fruit
A powerful metaphor can be illuminating, but it can also be highly misleading.
The idea of long-hanging fruit is ubiquitous in environmental policy — sometimes in the form of a simple metaphor, other times expressed in more sophisticated terms as an assumption of rising marginal costs of pollution reduction. It’s an arresting metaphor, and one that can often be illuminating. But like many powerful metaphors, it can also …
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CONTINUE READINGEconomists vs. Environmentalists: Time for Deténte?
You don’t have to love economics to see it as a possible ally.
Cost-benefit analysis has long been the target of environmentalist ire. But one lesson of the Trump years has been that economic analysis can be a source of support for environmental policy — it is the anti-regulatory forces who have to fudge the numbers to justify their actions. Most energy and environmental economists are aghast at …
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CONTINUE READINGThe Social Cost of Carbon – Revisited
The case for using global rather than simply U.S. impacts.
The estimated harm done by a single ton of carbon in the atmosphere – the “social cost of carbon” — is a key factor in setting climate policy. The Trump Administration is trying to get its estimate as close to zero as possible. A key part of this effort is to exclude from consideration the …
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CONTINUE READINGWill Renewable Energy Keep Getting Cheaper?
Technological and economic forces will continue to cut prices, regardless of Trump.
The Trump Administration is trying to save coal and stop the growth of renewables. Just this week Scott Pruitt issued a proposed repeal of Obama’s Clean Power Plan. Whether or not the repeal succeeds, Pruitt & Co. are fighting against the economic tide. If the price of renewables continues to fall, it will be harder …
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CONTINUE READINGObsolete Arguments Against Climate Action
Conservatives keep repeating the same arguments, even though the world has changed.
There used to be some fairly plausible arguments against fighting climate change. I don’t mean crackpot theories about hoaxes or the “I’m not a scientist” hokum. Instead, the arguments I have in mind could be made with a straight face by serious people. I don’t think these arguments were ever truly persuasive, but they weren’t …
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CONTINUE READINGWhither the Social Cost of Carbon?
Trump rescinded the Obama Administration’s estimate. Now what?
Republicans vehemently attacked the Obama Administration’s estimate of the social cost of carbon. Trump withdrew that estimate and directed individual federal agencies to do their own estimates. The agencies will now be faced with a number of problems, and it’s not clear that they are well positioned to deal with them. They might prefer to …
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CONTINUE READINGCutting Through the Smog
New research highlights the importance of reducing ozone pollution and suggests ways to do it.
As a change of pace, here’s a post that’s not about Trump, Pruitt, or their friends in Congress. Two recent papers highlight the importance of EPA’s tightening of the air quality standard for ozone and suggest some ways of doing so that could be more acceptable to industry. (We’re talking about ground-level smog here, not …
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CONTINUE READINGThe Economic Impact of AB 32 on California
New study suggests that the economic impact of cutting carbon is modest.
What is the economic impact of California’s climate change regulations? Will they reduce actual emissions or just shift them out-of-state? A new study by Resources for the Future addresses an important part of the puzzle. Reasearchers at RFF modeled the effect of compliance costs of $10/ton or $22/ton of CO2 on highly energy-intensive industries such as …
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CONTINUE READINGLegacy Goods and Environment Preservation
The value of some goods like wilderness today depends on their futures.
Normally, economists imagine, equal experiences become less valuable as they recede further into the future. But some types of goods don’t have that kind of relationship with future experiences. They can become more valuable as they extend farther into to the future. Take this blog post, for example. I’m really happy that you’re reading it …
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CONTINUE READINGWhat Economists Don’t Get About Our Relationship With Nature
No, climate change isn’t less of a problem if people get used to a devastated world.
People often adjust to problems that seem terrible upfront. Some studies show, for instance, that people who who lose limbs are very unhappy for awhile but then start to adjust to their positions. Some economists argue that something similar may happen with climate change — we might find that we don’t miss extinct animals or …
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