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Brianna Rakouska
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In the face of our current political climate, this piece is especially upsetting because it illustrates that effects of environmental choices made by a nation are not contained within that nation's borders. It details that climate change will affect all regions with negative effects for ecosystem and economy. It is easy to forget that a small change in the climate can have such drastic effects because we are so used to large fluctuations in weather temperatures but this piece does a great job of detailing likely changes due to different increases in temperature. Unfortunately, because such small fluctuations can have such drastic effects it is easy to move past a threshold without realizing it. It is a possibility that we may have already begun a runaway positive feedback loop of climate change. This piece talks about the melting of permafrost, which releases methane, which is an even more powerful greenhouse gas than CO2, which will contribute to the continued warming of the atmosphere.
Toggle Commented Mar 30, 2017 on ECON 255 for Thursday at Jolly Green General
It is frustrating to read how policymakers can not/will not implement carbon taxes. The Murray and Rivers paper mentions how economists often prescribe carbon taxes, but that one of the barriers to entry is the lack of public support, disincentivizing politicians to enact these types of taxes, despite the potential short and long-term benefits. While cap-and-trade programs generally use the majority of their revenue for green projects, carbon tax revenues are more commonly used for general funds or returned to taxpayers. This benefits the environment and individuals, so theoretically there should be more support than there is for these types of taxes, especially if it could be implemented without heavily burdening the poor. It is clear that cap-and-trade and carbon taxes both have shortcomings but an even bigger loss would be the damage caused to the environment should we do nothing.
Toggle Commented Mar 23, 2017 on Econ 255 readings - update at Jolly Green General
Looking at different tradeoffs of energy byproducts while reading fueling our future made me uneasy because of all of the unknowns associated with carbon burial and nuclear waste. How is it possible to decide if long term effects of radioactive waste or carbon will leave humanity worse off? I would like to know more about carbon sequestration and its potential effects on marine life and the potential for high ocean acidification. Nuclear power is tainted by the negative image of nuclear meltdowns, but I am not convinced this is a bad thing because radioactive waste is far more deadly and permanent than carbon in the atmosphere. The only possible solution, as addressed in this paper is a reliance on multiple sources for energy, which is also the best solution. Reading projections about future effects of carbon paints a dismal picture of the future, which is summed up by Shaw’s quote: “five hundred and fifty [PPM of atmospheric carbon] may be the best we can do, but it is still a disaster”.
Toggle Commented Mar 9, 2017 on Econ 255 for next week at Jolly Green General
Like some other people have commented, I also found it surprising that is the dominant method for energy production, considering its overbearing costs. The thing that I found even more surprising though was Kinsey’s comment that coal miners continue to fight for coal jobs and encourage their children to pursue coal mining even after they have seen the direct effects of this lifestyle. This is a good example of market failures through asymmetric information and lack of alternatives in the form of jobs. Transitioning to different forms of energy such as solar or wind or natural gas would not provide communities with the same number of jobs that these economies rely on. In addition, many of these negative externalities associated with coal are easy to ignore because we do not bear the brunt of many of the problems associated with it, such as the health effects borne by the communities.
Like many other people have mentioned, the revealed disconnect between Tobago’s resident's livelihood and how they feel it relates to the reef health is surprising to say the least. Education of the residents in this area would be highly beneficial, as the paper mentions, to reef health and creating a cohesive management plan. Philip brought up an interesting idea of simply stopping the tourism industry in this area. The reef, in the absence of human contact, would flourish. However, if the reefs were fully devoid of human contact, Tobago’s entire economic system would shut down. This is an excellent example of finding the optimal level of use of a situation. In Phillip’s scenario, locals and travelers do not benefit but the reef benefits fully. I would argue that use of the reef drives up its value, even if degradation does occur because locals would be able to use it for its resources and for their livelihoods, and travelers would gain experiential value and would learn about the local ecosystem. If the locals could be further educated about the importance of the reef and the interconnectedness of the island, marine, and economic system, this would make them value it more and incentivize them to begin to manage it more effectively. Essentially, it is not realistic to think of a situation that involves no contact with an entire system, but even if it was possible, it would not be optimal.
It is always interesting to me that in areas where environmental tourism is a critical part of the economy that environmental conservation is not more prevalent. Instead of conserving and regulating the ecosystem that supports their livelihood, it falls victim to the tragedy of the commons, degrading over time as a result of its exploitation. Mitigating this problem is a complex issue, but choice modeling provides a method to evaluate the willingness to pay that could be used to generate more revenue to protect the reef. This can be useful for the local economy that relies on the reef and the divers for their livelihood because it gives them a numerical value they can use as a price point. Taking advantage of the gap between actual cost and WTP would allow the rehabilitation of the reef with the additional funds. In this example, a population of passionate, well-off divers would not be fazed by a price increase and if educated about how their money was helping, would likely support the cause. In a different scenario, with a more diverse income bracket, willingness to pay would be more variable. If price was found to be below average willingness to pay, and the price was raised, this would cause a group of people to no longer utilize the ecosystem. While less traffic may benefit the ecosystem, it will also result in a group of people that will not experience the ecosystem and thus create a group that will not reap the benefits of an experience there, and will thus value it less. An important aspect of value is option value, and if people are not willing to pay inflated priced, they will feel that they do not have the option to use it.
The tragedy of the commons is a common problem that we observe in our day-to-day lives. From the overuse of a common space by housemates, to the overfishing that our fish populations are facing, it exists on large and small scales. Last semester, we did a fishing simulation after reading the Tragedy of the Commons, and even when we were acutely aware of the effect we were having, our behavior persisted. The gains we were receiving were greater than the marginal losses experienced by everyone. The same thing holds true for common spaces in my house. It is easier for me to leave a mess in the living room or dishes in the sink because I know that my housemates will do the same regardless of if I do or not. On that same thread, it is not beneficial for me to invest my time and effort in keeping it clean because their behavior will continue and quickly diminish the benefit. One of the largest problems we face with the Tragedy of the Commons is that we don’t know all the costs we are incurring in degrading our environment. As Krutilla details, there are unknown factors in an ecosystem such as cures for cancer or unknown effects on other systems (such as source and sink dynamics) that we cannot fully consider when evaluating costs. As we have seen, population pressure can be alleviated with new technologies, and in some cases environmental services can be replicated, but these come at high costs, both monetary and environmental. For example, as we contaminate our freshwater, we have begun looking for new technologies such as desalination. Desalination plants are expensive to build and use large amounts of carbon based energy, which will enter our atmosphere in large quantities and add to the volume of gasses promoting global climate change. The technologies we should be looking into and investing in should work with and/or mimic natural process so that we can slow our ecosystem depletion.
It is refreshing and comforting to read about economists that consider and care about the environment. Krugman states that 2,500 economists see the importance of limiting greenhouse gas emissions, indicating that economists are more enthusiastic about the environment than many assume. Being that this was originally published in 1997, I can only assume this number has increased dramatically in the face of the growing concerns with climate change. Despite this, there has been little progress in adjusting the market to accommodate for this concern. Inevitably, when considering economics and the environment the problem of valuation and the cost of degrading that environment comes up. As discussed in class, it is easy to put a price on a barrel of oil or a ton of timber. There are obvious problems with measuring the costs of pollution and environmental degradation because it is difficult to place a value on a something that does not act as a regular market good. Additionally, ecosystems are more complex than we realize and our actions may have unexpected and seemingly unrelated consequences. Stavin says that “perfectly functioning markets are the exception rather than the rule” which hits the nail on the head. In my Business and the Natural Environment class we discussed consumer demand as one way to mitigate externalities like environmental degradation instead of through taxes. Similar to the invisible hand, if individual consumers were demanding products that were not harmful to the environment, the market would shift to accommodate these preferences, benefiting humanity and the environment. This is fairly unrealistic as it would require more education for consumers on the environment, full information for them to make informed decisions, and the means to be discerning when they make purchases.