GDAE: Climate Economics

Tufts’ Global Development and Environment Institute (GDAE) hosted a panel of Tufts affiliated professors and researchers to discuss the global economics of climate change. The panel featured:

  • Gilbert Metcalf -Tufts Department of Economics
  • Killy Sims Gallagher – Tufts Fletcher School
  • Sivan Kartha – Stockholm Environment Institute

Metcalf related his discourse to the COP21 Conference in Paris this year. Encouraged by the inclusion of all countries striving to take action on climate change, he remained pessimistic about the inadequacy of the agreements in actually addressing the problem. He does see signs for optimism in many of the subsidies to clean energy, EPA regulations, research and development on carbon capture and sequestration, and carbon pricing pilots. Metcalf has long advocated for institution of carbon pricing, specifically a carbon tax. He defends the regressive nature (the tax falling disproportionately on the poor) by suggesting a flat payback amount, where lower income folks will get back more than they put in. He points out sub-national carbon tax initiatives such as ClimateXChange, whose mission is to implement comprehensive market-based carbon pricing in Massachusetts.

Gallagher covered the innovation process for clean energy technologies:

Growth Model of Innovation

Growth Model of Innovation

She ascribes the success of a new technology based on a combination of Pushes (e.g. investments in new technology) and Pulls (e.g. policies to encourage technology use). As an example, she outlined China’s process for, first, production of PV solar panels (a push), followed by widespread adoption of solar panels among the Chinese population (a pull) several years later.

Gallagher then refuted the notion that increased production of a new technology results in a reduced price. The vast majority of public investment in energy technology over the last 40 years has been in nuclear power, which has gone up in cost over that time. In essence, her point is that we can’t rely on technologies to become cheaper.

Sivan Kartha’s talk also covered this year’s Paris agreements. His discussion mostly focused on finding an equitable fair share in the distribution of burdens for reducing the effects of climate change. He quotes Al Gore, who said in a 2007 New York Times op-ed that “countries will be asked to meet different requirements based on their historical share or contribution to the problem and their relative ability to carry the burden of change. This precedent is well established in international law, and there is no other way to do it.” Showing this chart he illustrates the historical responsibility for emissions, where OECD-1990 Countries (the “developed world,” roughly) feature prominently:

Responsibility for Historical Emissions (

Responsibility for Historical Emissions (

Using per capital annual income as a measure of capability to bear the burden or addressing climate change, countries could calculate their burden based on the proportion of their population making above the “development threshold,” below which they would be excluded from the calculation. Kartha’s proposed development threshold of $7,500 PPP would exclude most of India’s population, much of China’s population, and only a small portion of the U.S. population. By this method, countries would be required to pay an amount that is commensurate with their population’s ability to pay. In summary: we are not on track to address climate change. Increased international cooperation is the only way to achieve the changes we seek.

1 thought on “GDAE: Climate Economics”

  1. I believe for our climate economy, if people will slowly and together drop the need to control and put numbers on our earth’s resources, will we be able to solve our Earth’s problems. I hope it won’t be too late before we do something about it. It’s true, we need everyone’s attention and cooperation to have the change we need to even survive on this planet. So many are even dying from pollution that we as a race create!

    Aside from that, it would really help if each and every citizen knew what they need to do to solve climate issues, not just by not driving our cars but recycling, packaging etc.

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