1 Nov 2021
Cutting Down Carbon Emissions Gains Economic Support
The Index Today
With the ongoing Climate conference in Glasgow, a number of world leaders have pledged to bring carbon emissions down to zero. William Nordhaus, world renowned climate economist and Nobel laureate stated that climate change would lead to effects on economic growth but not enough to justify the cost of trying to maintain global temperatures below 2 degrees.
However, his argument is now being challenged by economists who believe that his economic model is outdated. According to latest research, the cost from emissions is predictably higher and does not prove that net zero is cost-effective.
The White House has consulting with economists to help understand the effect of emissions and find a new cost for carbon which matches the value in current times. The higher cost of carbon must be able to justify the strict emissions curbs that could provide a basis for talks and commitments made by the president in Glasgow.
Even with a number of economists working to model a new climate economy, only three IAMs are fully established. However, many features of these economic models have come under scrutiny. The issues are not anywhere near to be settled as economic assumptions are likely to be subjective rather than scientific. Governments around the world are considering imposing fines and penalties on carbon emissions which lead to social costs.