Theme Overview: Climate Change Economics

The magazine of food, farm, and resource issues ©1999–2008 CHOICES. All rights reserved. Articles may be reproduced or electronically distributed as long as attribution to Choices and the American Agricultural Economics Association is maintained. Choices subscriptions are free and can be obtained through This thematic package in Choices celebrates the International Panel on Climate Change (IPCC) work, its Nobel prize and the significant contributions of agricultural and resources economists to the IPCC process and reports. These nine papers present work which overviews the major aspects of climate change and its implications for agriculture and natural resources written by people who have been intimately involved with the IPCC. The researchers examine five major topics as they address climate change economics: • Gerald North, a meteorologist, discusses the nature of projected climate change. North led a recent National Academy panel on climate change and has been an IPCC reviewer and provider of information. • John Antle considers the relationship between climate change and agriculture; Rich Adams and Dannele Peck explore the implications of climate change and water. Antle and Adams were both IPCC lead authors. • Steve Rose and Bruce McCarl consider the implications of emissions prospects for climate change and agricultural adaptation needs; both researchers were lead authors. • Uwe Schneider and Pushpan Kumar examine the significance of emissions mitigation possibilities broadly; Cees Van Kooten addresses sequestration; Brent Sohn-gen focuses on deforestation; and Bruce McCarl on biofuels. Schneider was an IPCC contributing author and the rest lead authors. • Gilbert Metcalf and John Reilly evaluate alternative policy approaches to climate protection; Reilly was an IPCC lead author. After North sets the stage, the rest of the papers present the case that economics can make good climate change policy better, and can prevent bad policy from getting worse. Each paper addresses in its own way the three key ways economics can improve climate change policy. First, economics asks climate policymakers to distinguish a stock from a flow pollutant, and its relationship to damaged ecosystem services. Stock pollution is concentration-the accumulated carbon in the atmosphere, like water in a bathtub. Flow pollution is emissions-the annual rate of emission, like water flowing into the tub. Because risk comes from the total stock of carbon, policies should focus on projected concentration levels. Greenhouse gases remain in the atmosphere decades before they dissipate, so different rates of emission could generate the same concentrations by a given …