Economics can help shed light on many important aspects of the climate change issue. By revealing the costs and benefits of various policy options and market-based alternatives to government regulation, economics can help policymakers discover cost-effective responses to the possible threat of climate change.
This is important in the climate change debate, especially since the “alleged sources” of climate change – carbon dioxide and other greenhouse gases emitted from billions of sources both anthropogenic and natural – are difficult and expensive to regulate.
Economists can help compassionate people reconcile the real-world trade-offs of protecting the environment while using natural resources to help their fellow men and women. They have shown how entrepreneurs can use private property, price signals, and markets to discover new ways to protect the environment without relying on government force. They also bring value to the global warming debate thanks to their expertise in statistical analysis and forecasting.
Economics can show committed environmentalists how they can better achieve their goals by recognizing fundamental economic principles such as the need to make trade-offs, to measure costs and benefits, and to take into account such economic concepts as discount rates and marginal costs.