Introduction to the Book by Peter Tsigaris

This anthology book is a contribution from my students in an undergraduate course called the Economics of Climate Change. Students came from a variety of backgrounds and disciplines. Many were from the natural resource management degree, while others were from business, science, or arts. Initially, my students were exposed to the science of climate change during the first three weeks before getting into the economics of climate change. These first few weeks were necessary since economic analysis and policy cannot be done without a strong foundation of the science that informs us about emissions and climate change.

My students and I saw the climate change issue as one of the biggest market failures the world is facing. Anthropogenic-caused climate change is a negative externality, as it affects future unborn generations who are not participating today in the market. The atmosphere, oceans and land acting as carbon storage are common (collective) resources and can lead to the tragedy of the commons since there is no global governance institution. Furthermore, climate change mitigation is a global public good in that the benefits are non-rival, and no one can be excluded from enjoying the benefits of policies to reduce the damages. However, global public goods suffer from free riders if there is no global authority to punish free riders. Finally, climate change is seen by my students as a global, as opposed to local, problem, because:

• Its impact is long-term and persistent.
• It has both intra-regional and intergenerational equity inequities.
• Uncertainty and risk is pervasive.
• There are potentially significant and irreversible damages.

No wonder climate change is one of the biggest market failures the world is facing (Stern, 2008).

We explored the historical and future potential trends in GHG and fossil fuels under alternative scenarios. We framed the GHG emissions problem within the IPAT framework to assess the main drivers of CO₂ emissions. Namely, we looked at population, affluence and technology’s roles in driving or reducing emissions. We examined climate change within the framework of Malthusian and Post-Malthusian societies, emphasizing environmental constraints (Tsigaris & Wood, 2024). We discussed the impact of climate change on growth and economic development. We analyzed and debated the stabilization of GHGs to net zero and the cost of achieving such ambitious targets. Various mitigation policies, with their benefits and costs, were brought forward for analysis, such as carbon taxes, permit markets, and incentives for green technologies. We assessed adaptation measures. The international collective action and its challenges were illustrated by conducting a mock United Nations Framework Convention on Climate Change conference, whereby students in groups were representing the US, China, India, Europe, and other developed and developing nations and making pledges to keep temperature anomaly below 2°C relative to pre-industrial levels. The course ended with students engaging in experiential learning, whereby they figured out a cause-and-effect pattern of human activity and its implications using cards from Climate Fresk.

Students selected their commentary after a month into the course, which I reviewed and gave them the green light to proceed. The commentary had some requirements, such as keeping it around 600 words, including at least one table or figure, and using a few citations from academic research published in peer-reviewed journals. Meanwhile, I completed my commentary early in the semester so my students had an idea of what I expected from them. My commentary attempted to provide a perspective on the value of global climate regulation services of the world’s biomes using the Ecosystem Services Valuation Database (ESVD) developed by Brander et al. (2023), which I plan to publish with my colleague Dr. Lauchlan Fraser, a professor in the natural resource department who studies reclamation and is an expert in ecology and community. Students submitted two drafts of their commentary during the semester, and I provided constructive feedback. They used this feedback to revise their work until they submitted a final version at the end of the semester, which is now available in this book. Allowing students to revise their work is a method I have been using for the last few years, and the result is significantly better quality of work from students (Tsigaris, 2021). I am very proud of my students’ work. I read commentaries from their research that were an eye-opener for me. I am confident that you will find this work of significant value, and I am looking forward to your thoughtful and insightful feedback.

Sincerely yours,

Panagiotis (Peter) Tsigaris

References

Brander, L. M., de Groot, R., Guisado Goñi, V., van ‘t Hoff, V., Schägner, P., Solomonides, S., McVittie, A., Eppink, F., Sposato, M., Do, L., Ghermandi, A., and Sinclair, M., Thomas, R., (2023). Ecosystem services valuation database (ESVD). Foundation for Sustainable Development and Brander Environmental Economics. https://www.esvd.net/

Stern, Nicholas. 2008. “The Economics of Climate Change.” American Economic Review, 98(2), 1–37. http://doi.org/10.1257/aer.98.2.1

Tsigaris, P. & Wood, J. (2024). Is there an end to sustained economic growth? Social Science Research Network. http://dx.doi.org/10.2139/ssrn.4742935

Tsigaris P (2021) Formalized journal-style review process: Improving the quality of students’ work. Frontiers in Education, 6, Article 701978. http://doi.org/10.3389/feduc.2021.701978