Christian Gollier: How should Society be organized to fight climate change? The economics viewpoint
9:30 AM, Wednesday 26 May 2021 EDT (1 hour 15 minutes)
In order to win the world war against climate change, one will have to incentivize billions of people andentreprises to implement a myriad of micro- and macro-actions to reduce global emissions. The problem is that these stakeholders will bear 100% of the cost, and basically 0% of the benefits, which will mostlygoes to future generations. This so-called externality and free-rider problems have only one solution which is unanimously supported by economists. They propose to implement the polluter-pay principle by imposing a universal price of carbon that should be equal to the marginal climate damage. I will also discuss the alternative solutions.