KINDLY INCLUDE DEFINITIONS OF ECONOMIC CONCEPTS TOO. THANK YOU. An introduction
ID: 1131806 • Letter: K
Question
KINDLY INCLUDE DEFINITIONS OF ECONOMIC CONCEPTS TOO. THANK YOU.
An introduction should typically outline the phenomenon you have chosen and highlight its significance. You may present some data to illustrate the phenomenon. Good economic analysis entails identifying (1) the various aspects of the exchange process (the market, the agents involved, the equilibrium outcome), (2) the factors that can affect market outcomes over time and (3) the welfare implications of the exchange outcome and whether there is scope for government intervention. Use graphs, formulae and diagrams where they help your explanations (more rigorous and succinct) compared to words alone. A good conclusion section will provide a look at the big picture, the significance of your findings in a larger context, and even suggest limitations of the models that you have used. Remember this is an economics assignment and therefore you should refrain from writing a report that is general and/or journalistic in nature.
Green-House Gas Emissions and Climate Change
The issue of green-house gas emissions and climate change has received a lot of media attention over the last decade. While some countries have taken steps to tackle this issue, others have chosen not to respond. Perform an economic analysis of this phenomenon and its welfare implications. Make sure you include definitions of relevant economic concepts. Include in your answer the scope of government intervention in tackling this issue.
Explanation / Answer
Green-House Gas Emissions and Climate Change
INTRODUCTION-
There is a global consensus on the issue of CLIMATE CHANGE and it has been stressed and reiterated in various international platforms to take a “strong action” in order to have controlled and limited negative consequences of this global phenomena. Economists from different schools of approaches play an important and inevitable role in the process of policy-making while determining the costs of various activities as well as of their consequences on the environment.
ECONOMIC ANALYSIS OF GREEN-HOUSE EMISSIONS AND CLIMATE CHANGE-
There are many approaches to make formulations and evaluation to calculate these costs. Each method has its own merits and demerits with the similarity that the values obtained can never be treated as the “perfect numbers”. These approaches of evaluation of costs and formulating policies can be grouped into-
1. Control the activities that cause pollution.
2. Levying Charges on those activities that cause pollution.
The first approach includes- limiting the cost of fuel for production of electricity, control of activities that leads to the emission of greenhouse gases like carbon dioxide, sulfur.
The second approach in this arena is- levying emissions tax—Pigouvian tax, practice of cap-and-trade system and evaluation of negative externalities. Geoengineering also reflects the same approach - in order to minimize the impact of anthropogenic activities we should offset them with deliberate impacts in the opposite direction. This approach is quite different from the conventional one that stresses on control of human activities.
The systems where the effect of the policies implemented and their benefits can be measured in monetary values are divided into –“Manageable systems” which includes activities that are impacted by the change in climate like public health and agriculture. Any benefit as a result of the application of any two approaches can be calculated with relative ease as compared to in “unmanageable systems” like oceans.
QUANTITATIVE MODEL OF ENERGY PRICES OVER THE LONG TERM-
Nordhaus was of belief that to think clearly about the economics of exhaustible resources like oil and coal, it was necessary to look into the future, to assess their true value as they become more scarce resource after considering available resources, future technologies and expected future economic growth. he developed a model to assimilate all of this information—
Two crucial lessons that were learned as a product of this landmark study are—
When it comes to climate change uncertainty strengthens, not weakens. Uncertainty cannot be banished from the issue of global warming; what one can do is to make the best predictions possible.
As a refinement and modification of earlier models, a new model was developed to give better prediction- INTEGRATED ASSESSMENT MODELS” (IAMS). This model makes an effort to combine together what we know about two systems—the economy and the climate—map out their interactions, and let us do the cost-benefit analysis of alternative policies.
IMPORTANCE OF ECONOMIC ANALYSIS AND ITS WELFARE IMPLICATIONS-
Applying the principles of economics for forecasting the cost of the exhaustible resources for future generations is not less than a one-time play of gamble. Values evaluated if exceed the actual baseline costs may do a great damage to the policies formulation process. The undervaluation of the costs will trigger the economic activities that will have negative consequences that may prove devastating.
CONCLUSION-
It can be conjectured that the calculation of the costs and benefits in the highly dynamic “climate-change structure” is a gambler’s task as one may not know where the baseline may shift- above or below. Any marginal shift may cause great benefit or disincentive. Therefore, a precautionary but realistic approach is required while assessing the costs of such activities and commodities that yield number that is not too high to achieve or too low to cause irreversible damage to the fragile ecosystem we need to sustain.
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.