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By: Alexander Golub and Anil Markandya
288 pages, illustrations, tables
This book presents a compendium of methodologies for evaluating the economic impact of technological innovation upon climate-change policy. There is a broad consensus on the key elements of climate-change science and agreement that near-term actions are needed to prevent dangerous anthropogenic interference with the climate system. However, there is little agreement on the costs and benefits of climate policy. Any policy implementation will result in an irreversible but environment-improving investment in alternative technologies; this change will generate immediately-realized costs but significantly-delayed benefits.Hence, a critical element in policy selection is the inherent uncertainty in the climate and economy that can be expected over time. The authors use mathematical models and their predictions, but the book contains no explicit empirical work. The goal is to provide a practitioner's guide for the science of economics and climate change. Because the assumptions motivating different problems in the economics of climate change have different complexities, a number of models are presented with varying levels of difficulty: reduced-form and structural, partial- and general-equilibrium, closed-form and computational. A unifying theme of these models is the incorporation of a number of price and quantity instruments and an analysis of their respective efficacies.
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