Quickly reducing greenhouse gas emissions, currently the main driver of global warming, requires a coordinated change in economic choices throughout the economy. Since prices coordinate economic behaviors, that means prices must adjust adequately. After greenhouse gas emissions have been reduced, prices must remain consistent with low greenhouse gas emissions. Consequently, speeding a transition to a low emitting state involves generating a time path of suitable prices. Price changes can follow and can reflect new technologies and their adoption -- the current laissez-faire strategy -- or price changes can lead and can encourage new technologies and their adoption. Speeding economic adjustment requires early price changes that generate widespread searches for means of lessening emissions. As I explain, a specialized emissions money can speed the adjustment process (1) while supporting ongoing full employment, (2) while increasing the demand for new low emission technologies throughout the economy, (3) while requiring explicit budgeting and planning whenever purchasing materials that can generate greenhouse gases, (4) while compensating for the differing global warming potentials of different greenhouse gases whether carbon containing or not, and (5) while compensating for the ongoing inequitable generation of greenhouse gases. Governmental action in the form of compatible policy changes and investments in infrastructure would dovetail with the influence of the emissions money by lowering the cost of adopting emission lowering technologies while increasing energy efficiency throughout the economy, further shortening the time needed to get a grip on global warming.
Steve Staloff received his PhD from the University of Oregon in Economics. He taught at the University of Maine and Portland State University, did theoretical and statistical research on resource, solar and conservation issues at Resources for the Future and Pacific Northwest Laboratories, and is currently a Visiting Scholar in Systems Science at PSU. His current research focuses on the nature of an evolutionary sequence. One implication from that research is that whenever and wherever a technologically-focused species develops sufficiently, the casual use of the commons is likely to accumulate waste products leading to global impacts deleterious to the survival of that species. Mitigation strategies must correct existing behavioral errors while insulating against similar errors in the future. This lecture addresses a mitigation strategy.
Greenhouse gases -- Government policy -- United States, Greenhouse gas mitigation, Climatic changes -- Economic aspects, Global environmental change, Economic indicators -- Analysis, Fossil fuel power plants -- Environmental aspects, Global warming -- Economic aspects
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Staloff, Steve, "Getting a Grip on Global Warming Quickly via a Specialized Emissions Money" (2021). Systems Science Friday Noon Seminar Series. 105.