Archive for the ‘Environment’ Category

economic consequences of global warming

Monday, March 30th, 2015

Pilita Clark, environment correspondent for the Financial Times, reviews a book on the economic consequences of climate change, and possible responses to it.

The correct economic solution [for global warming] has been well understood for years, they [Wagner and Weitzman] argue: stop subsidising fossil fuels by about $15 a ton of C02 globally, and create a price of at least $40 a ton. But Climate Shock advises economists to stop demanding a global carbon price and start working on more politically possible solutions, such as fuel economy standards. That sounds dull compared with geoengineering. But it is also infinitely safer.

This is not a book for people deeply versed in climate policy, few of whom will find its contents remotely shocking. For the intelligent lay reader wanting a lively, lucid assessment of the economic consequences of global warming, however, it is well worth reading.

Pilita Clark, “‘Climate Shock: The Economic Consequences of a Hotter Planet’, by Gernot Wagner and Martin Weitzman“, Financial Times, 30 March 2015.

The first chapter of the book, published recently by Princeton University Press, can be viewed here.

global warming and US politics

Tuesday, November 11th, 2014

Martin Wolf looks at the implications for climate change of the Republican victory in recent midterm elections.

The most important consequence of this election may therefore be to bury what little hope remained of getting to grips with the risk of dangerous climate change. Countries cannot keep bits of the atmosphere to themselves. Moving off the world’s current trajectory is a collective task. Without US will and technological resources, the needed shift will not happen. Other countries will not – indeed cannot – compensate.

Many Republicans seem to have concluded man-made climate change is a hoax. If so, this is quite a hoax. Just read the synthesis report of the Intergovernmental Panel on Climate Change. One is asked to imagine that thousands of scientists have put together a complex fabrication in order to promote their not particularly remunerative careers, in the near certainty they will be found out. This hypothesis makes no sense.

Martin Wolf, “Republican midterm victory bodes ill for warming planet“, Financial Times, 12 November 2014.

Martin reminds us that the US is not only “the world’s largest and most technologically advanced economy, guarantor of the open world economy and greatest military power”. It “is also the world’s second-largest emitter of greenhouse gases and among the highest emitters per head”.

deforestation and global warming

Monday, May 26th, 2014

The UN says the world must cut carbon emissions by some 40-70 per cent by 2050. This target cannot be reached if the current rate of deforestation does not dramatically slow. But any action to protect the world’s forests creates a dilemma: how can these vital areas be protected without unfairly holding back the economic growth of developing countries?

An important part of the solution is to enable rich-nation emitters to pay developing countries to maintain their forests. Compared to other carbon-reducing policies – such as investment in renewables – this is a very cheap option. ….

[But,] there is a constant risk that the protection of one part of a forest merely leads to another part of it being chopped down instead. Even if the government is fully committed to a scheme, its governance systems may not be able to protect an area from illegal destruction. International bodies therefore need to put in place agreed systems to certify that forests have both truly been protected and that the schemes are additional to plans that existed without the extra funding.

The role of forests in cutting carbon“, Financial Times, editorial, 26 May 2014.


cows and global warming

Wednesday, April 9th, 2014

Carbon dioxide from fossil fuels is the primary man-made gas warming the planet, but methane is far more potent and the US’s biggest source of it is its 88m cattle, which produce more than landfill sites, natural gas leaks or hydraulic fracturing.

The Obama administration’s launch last month of a plan to curb methane emissions has given fresh relevance to climate-friendly technologies for cattle that range from dietary supplements and DNA gut tests to strap-on gas tanks.

Juan Tricarico, director of the Cow of the Future project at the Innovation Center for US Dairy, an Illinois research institute … said there were common misconceptions about where cattle methane comes from. “Ninety-seven per cent of all the methane gas is released by the front end through burps, not from the back end,” he said. ….

Methane accounts for 9 per cent of US greenhouse gas emissions and does not linger in the air as long as CO2, but it has a global warming effect more than 20 times greater than CO2, the White House says. ….

At Argentina’s National Institute of Agricultural Technology, scientists have created backpacks that collect gas via tubes plugged into cows’ stomachs. A typical animal emits 250-300 litres of methane a day and researchers say this could be used to power a car or a refrigerator for a day, but Jorge Antonio Hilbert of the institute says the tanks’ use on a large scale is “totally improbable”. ….

Ilmi Granoff of the Overseas Development Institute said … “Forget coal, Forget cars. The fastest way to address climate change would be to dramatically reduce the amount of meat people eat,” he said. “But that involves cultural preferences and they are difficult to touch.”

Barney Jopson, “Scientists seek climate-friendly cow of the future“, Financial Times, 9 April 2014.

Another reason to feel guilty when eating steak … or even while drinking milk!


poverty and transportation

Sunday, March 9th, 2014

“A developed country is not where the poor have cars … it is where the wealthy use public transportation.”

Yet another illustration of the adage that “services for the poor are poor services”.

I would add that, all else equal, lack of adequate public transportation means the poor are poorer, because they are forced to purchase a vehicle or walk long distances. This fact is overlooked in measures of poverty.

And, of course, a private automobile harms the environment much more than use of public transportation does.


Source: ILDES  (Instituto Latinoamericano para el Desarrollo Económico Sustentable).

climate policy in poor countries

Thursday, February 27th, 2014

Two American academics have drafted a compelling op-ed for today’s Financial Times.

Having failed to stem carbon emissions in rich countries or in rapidly industrialising ones, policy makers have focused their attention on the only remaining target: poor countries that do not emit much carbon to begin with. ….

In Nigeria [for example], the UN Development Programme is spending $10m to help “improve the energy efficiency of a series of end-use equipment … in residential and public buildings”. As a way of lifting people out of poverty, this is fanciful at best. Nigeria is the world’s sixth-largest oil exporter, with vast reserves of natural gas as well. Yet 80m of its people lack access to electricity. Nigerians do not simply need their equipment to be more efficient; they need a copious supply of energy derived from plentiful local sources.

Or consider Pakistan, where energy shortages in a rapidly growing nation of 180m have led to civil unrest – as well as rampant destruction of forests, mostly to provide firewood for cooking and heating. Western development agencies have refused to finance a project to use Pakistan’s Thar coal deposits for low-carbon natural gas production and electricity generation because of concerns over carbon emissions. Half a world away, Germany is building 10 new coal plants over the next two years. ….

We in the rich world have chosen economic growth over emissions reductions. It is cruelly hypocritical of us to prevent poor countries from growing, too. If we are forced to adapt to life on a planet with a less hospitable climate, the poor should at least confront the challenge with the same advantages that are enjoyed by the rich.

Roger Pielke and Daniel Sarewitz, “Climate policy robs the world’s poor of their hopes“, Financial Times, 27 February 2014. (ungated link)

Political scientist Roger Pielke is a professor in the environmental studies programme at the University of Colorado. Geologist Daniel Sarewitz directs the Washington, D.C. office of Arizona State University’s Consortium for Science, Policy, and Outcomes.

protecting the Amazon rainforest

Thursday, September 26th, 2013

NPR’s “Planet Money” podcasts are 15 to 20 minutes long and almost always worth listening to. This one is particularly interesting.

Ecuador’s Yasuni National Park, a pristine corner of the Amazon rainforest, is home to jaguars, giant otters, and the golden-mantled tamarin. The park also sits on top of hundreds of millions of barrels of oil, worth billions of dollars.

The government of Ecuador faces a choice: Should it protect the park, or go for the money?

Planet Money, “Episode 433: Holding A Rainforest Hostage?” (Update), 30 August 2013.

Ecuador’s government attempted to do both, but failed. Listen to the podcast to find out what happened, and why.

the illusion of precision in climate change models

Wednesday, September 25th, 2013

Development and use of complex models that integrate climate science with economic aspects of the impact of greenhouse gas emissions has become a growth industry. The field even has its own journal, The Integrated Assessment Journal. MIT economist Robert Pindyck reviews this effort and asks “What do the models tell us?”. His answer?

Very little. A plethora of integrated assessment models (IAMs) have been constructed and used to estimate the social cost of carbon (SCC) and evaluate alternative abatement policies. These models have crucial flaws that make them close to useless as tools for policy analysis: certain inputs (e.g., the discount rate) are arbitrary, but have huge effects on the SCC estimates the models produce; the models’ descriptions of the impact of climate change are completely ad hoc, with no theoretical or empirical foundation; and the models can tell us nothing about the most important driver of the SCC, the possibility of a catastrophic climate outcome. IAM-based analyses of climate policy create a perception of knowledge and precision, but that perception is illusory and misleading.

Robert S. Pindyck, “Climate Change Policy: What Do the Models Tell Us?“, Journal of Economic Literature, September 2013, pp. 860-872.

That is the abstract of a fascinating essay that should be read in its entirety. You can download an ungated pdf of the paper here.

Pindyck concludes with the following paragraph.

My criticism of IAMs should not be taken to imply that, because we know so little, nothing should be done about climate change right now, and instead we should wait until we learn more. Quite the contrary. One can think of a GHG [greenhouse gas] abatement policy as a form of insurance: society would be paying for a guarantee that a low-probability catastrophe will not occur (or is less likely). As I have argued elsewhere, even though we don’t have a good estimate of the SCC, it would make sense to take the Interagency Working Group’s $21 (or updated $33) number as a rough and politically acceptable starting point and impose a carbon tax (or equivalent policy) of that amount. This would help to establish that there is a social cost of carbon, and that social cost must be internalized in the prices that consumers and firms pay. (Yes, most economists already understand this, but politicians and the public are a different matter.) Later, as we learn more about the true size of the SCC, the carbon tax could be increased or decreased accordingly.

Professor Pindyck is co-author, with Daniel Rubinfeld, of the best-selling textbook Microeconomics (8th edition, Prentice Hall, 2012).

genocide on the Great Plains

Wednesday, September 25th, 2013

The word prairie comes from the French for meadow and was adopted by the early [North American] pioneers as they pushed west and came into contact with French-speaking settlers. Prairies are temperate ecosystems composed of grasses and flowering perennials with low, scrubby shrubs as the apex vegetation, rather than trees. ….

The story of the prairie is inextricably linked with that of the bison. So vast were the numbers of these 2,000lb behemoths – in the tens of millions – that early explorers reported the plains as “black, and appearing as if in motion”. They and the Great Plains were largely left alone during the early settlement of America. Until the early 1800s the plains were commonly known as the Great American Desert and were considered dry, inhospitable and hostile. From the 1830s, however, pioneers pushed west and the prairie became fragmented as claims were staked. ….

To encourage belligerent Native Americans to resettle to less promising land, the military undertook a policy (possibly authored by federal government or at least tolerated) of starving the Indians into submission by exterminating the animal they relied on most – the bison. The level of slaughter was breathtaking. An estimated 7.5m animals were killed in just two years between 1872 and 1874. By the end of the century, the roaming herds had been reduced to around 750 animals, mostly kept in zoos or on small reserves.

Matthew Wilson, “Conservation of America’s prairie – and return of the bison“, Financial Times, 21 September 2013.

Matthew Wilson is Managing Director of Clifton Nurseries, London’s oldest nursery. Matthew is also a radio and television broadcaster, and contributes to numerous UK publications, including the Financial Times.

Native peoples everywhere have suffered from the arrival of Europeans. I was familiar with the massive slaughter of American bison (“buffalo”), but previously thought it was done by individuals for sport, and to harvest valuable buffalo hides. I was unaware of the direct involvement of the US military in this activity, which caused great suffering in tribes of Native Americans. “Genocide” is not too harsh a word to describe it.

the early life of Economics Nobelist Elinor Ostrom

Sunday, September 1st, 2013

I learned a lot from this Saturday’s column of Tim Harford, the “Undercover Economist”. For starters, I learned that Lin Ostrom was born Elinor Awan in Los Angeles in 1933.

Lin was brought up in Depression-era poverty after her Jewish father left her Protestant mother. She was bullied at school – Beverly Hills High, of all places – because she was half-Jewish. She divorced her first husband, Charles Scott, after he discouraged her from pursuing an academic career, where she suffered discrimination for years. Initially steered away from mathematics at school, Lin was rejected by the economics programme at UCLA. She was only – finally – accepted on a PhD in political science after observing that UCLA’s political science department hadn’t admitted a woman for 40 years.

She persevered and secured her PhD after studying the management of fresh water in Los Angeles. ….

[It was in 1968,] when Lin saw [ecologist Garrett] Hardin lecture [on “The Tragedy of the Commons”] that she realised that she had been studying the tragedy of the commons all along. …. Garrett Hardin was 53, in the early stages of a career as a campaigning public intellectual that would last the rest of his life. Lin was 35, now Ostrom: she had married Vincent Ostrom, a respected political scientist closer to Hardin’s age, and together they had moved to Indiana University. Watching Hardin lecture galvanised her. But that wasn’t because she was convinced he was right. It was because she was convinced that he was wrong.

Tim Harford, “Do you believe in sharing?“, Financial Times, 31 August 2013.

The full column contains more facts that I was unaware of. I knew, of course, that Elinor Ostrom in 2009 became the first woman to win the Nobel memorial prize for economics, and that she died three years later, at the age of 78. What I did not know is that her much older husband, Vincent, died just two weeks later.

I can relate to Lin’s reaction to Garrett Hardin and his many followers, because flawed (“wrong”) publications on pensions keep me active in what would otherwise be a boring subject.