The Unassuming Economist

From the latest issue of the Journal of Economic Perspectives by Solomon Hsiang and Robert E. Kopp:

“Humans have engaged in large-scale transformation of natural systems for millennia. Stone Age hunting technologies led to extinctions of large mammals; agricultural revolutions transformed forests into farmlands; pursuit of minerals has carved the earth’s surface; dams and reservoirs now manipulate the flow of almost all rivers; and synthetic fertilizers now flood the nitrogen cycle. But among these transformations, the restructuring of the global carbon cycle and the accompanying alteration of the climate stands apart in its sheer scale, complexity, and economic significance. Essentially all humans that have ever lived contributed, in their own small ways, to reshaping this planetary-scale system. Thousands of years of forest clearance may have added hundreds of billions of tons of carbon to the atmosphere. In the industrial era, every home lit by a coal or natural gas-fired power plant and every petroleum-powered train, plane, and motor vehicle has contributed to the net accumulation of carbon dioxide in the atmosphere. The average human contributes about 5 tonnes of carbon dioxide (CO2) every year (Le Quéré et al. 2018), about a quarter of which will remain in the atmosphere for well over a millennium (Archer et al. 2009).

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The goal of this article is to provide a brief introduction to the physical science of climate change, aimed towards economists. We begin by describing the physics that controls global climate, how scientists measure and model the climate system, and the magnitude of human-caused emissions of carbon dioxide. We then summarize many of the climatic changes of interest to economists that have been documented and that are projected in the future. We conclude by highlighting some key areas in which economists are in a unique position to help
climate science advance. An important message from this final section, which we believe is deeply underappreciated among economists and thus highlight here, is that all climate change forecasts rely heavily and directly on economic forecasts for the world. On timescales of a half-century or longer, the largest source of uncertainty in climate science is not physics, but economics (Hawkins and Sutton 2009).”