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The Climate Club

William Nordhaus provides an excellent update on global warming in his review of Gernot Wagner and Martin Weitzman's Climate Shock:

Most scientists say that climate change is a “very serious problem.” Yet virtually no progress has been made in convincing the general public of its serious nature, nor have significant steps been taken to curb emissions and slow warming. ...
Wagner and Weitzman... argue that current policies are leading to a substantial chance (perhaps one in ten) that global temperatures will eventually rise by at least six degrees centigrade. This will, in their words, be “the end of the human adventure on this planet as we now know it. ...”
We have made no progress in slowing emissions, and concentrations of CO2 continue to build up. ...
The major challenge for climate policy is to overcome free-riding. The answer, I would suggest... is the “club model.” A club is a voluntary group deriving mutual benefits from sharing the costs of producing an activity. Members get the benefits but also pay the dues. ...
I recently described a possible Climate Club in the American Economic Review. ... A crucial aspect of the club is that countries who are outside the club—and do not share in the burden of emissions reductions—are penalized. ... Economic modeling indicates that the most promising penalty is uniform percentage tariffs on the imports of nonparticipants into the club region. ...
Undoubtedly, the concept of a Climate Club is highly idealized and even utopian. But consider the alternatives.... A Climate Club that ensures high prices of carbon emissions around the world, or the equivalent, is an essential step toward an effective policy to slow warming.
- William Nordhaus, A New Solution: The Climate Club, New York Review of Books, June 4, 2015


See also Eduardo Porter's commentary in the June 3, 2015 New York Times:

More than a quarter-century of fruitless efforts to induce the world’s major greenhouse gas polluters like China and the United States to significantly cut their emissions suggests the entire approach may be fundamentally flawed. ...
Professor Weitzman may be the most realistic of all. “I think, alas, that we will keep drifting to higher and higher greenhouse gas concentrations until climate change is perceived as something catastrophic at a grass-roots level,” he said. ... “The issue is not whether we will have disastrous effects,” Professor Weitzman told me, “but when climate change will have disastrous effects.”
- Climate Deal Badly Needs a Big Stick, Eduardo Porter, New York Times, JUNE 2, 2015



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