Geoscience Reference
In-Depth Information
world, the older global challenges have not disappeared, while new
ones have arisen—including not only global warming but others like
the threat of nuclear proliferation, drug traffi cking, international fi -
nancial crises, and the growing threat of cyber warfare.
Further refl ection will reveal that nations have had limited success
with agreements to deal with global economic externalities. Two suc-
cessful cases include handling international trade disputes (today pri-
marily through the World Trade Organization) and the protocols to
limit the use of ozone-killing chlorofl uorocarbons. The study of eco-
nomic aspects of environmental treaties has been pioneered by Colum-
bia University economist Scott Barrett. He and other scholars believe
these two treaties were successful because the benefi ts far outweighed
the costs and because effective institutions were created to foster coop-
eration among nations.
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Governance is a central issue in dealing with global externalities
because effective management requires the concerted action of major
countries. But, under current international law, there is no legal mecha-
nism by which disinterested majorities or even supermajorities of coun-
tries can require other nations to share in the responsibility for managing
global externalities. Moreover, extralegal methods such as armed force
are hardly recommended when the point is to persuade countries to
behave cooperatively rather than free riding.
Earlier chapters demonstrated that effective actions to slow global
warming require both near-universal participation and harmonized
policies. Most countries need to join an agreement. By doing so, policies
can be harmonized so that the marginal costs of emissions reductions
are equalized across nations and sectors. The strict conditions for effec-
tive policies are the reason why international agreements and institu-
tions are necessary.
What are the proposals and the actual institutions for dealing with
the global externality of climate change? Here are the four main ap-
proaches.
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1. Inaction, in which no measures are taken to override market sup-
ply and demand, and the climate-change externality is not corrected.
