How the Invisible Hand is Supposed to Adjust the Natural Thermostat: A Guide for the Perplexed

Title

How the Invisible Hand is Supposed to Adjust the Natural Thermostat: A Guide for the Perplexed

 Author

Storm, S.T.H. (TU Delft Economics of Technology and Innovation)

Date

2016

 Abstract

Mainstream climate economics takes global warming seriously, but perplexingly concludes that the optimal economic policy is to almost do nothing about it. This conclusion can be traced to just a few “normative” assumptions, over which there exists fundamental disagreement amongst economists. This paper explores two axes of this disagreement. The first axis (“market vs. regulation”) measures faith in the invisible hand to adjust the natural thermostat. The second axis expresses differences in views on the efficiency and equity implications of climate action. The two axes combined lead to a classification of conflicting approaches in climate economics. The variety of approaches does not imply a post-modern “anything goes”, as the contradictions between climate and capitalism cannot be wished away.

 Subject

Climate change economics
Carbon pricing
Social discount rate
Equity versus efficiency
Normative uncertainty

 To reference this document use:

http://resolver.tudelft.nl/uuid:1954fb2b-14d5-4267-b928-b99ff771d60a

 DOI

https://doi.org/10.1007/s11948-016-9780-3

 ISSN

1471-5546

 Source

Science & Engineering Ethics

 Part of collection

Institutional Repository

 Document type

journal article

 Rights

© 2016 S.T.H. Storm
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