Economics: Discussions

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Economics: Discussions

Discussion #1
Global warming refers to an increment in the average temperature of the earth's atmosphere due to additional heat being ensnared by green house gases along with human activities such as burning fossil fuels, deforestation, etc. it has an effect on both natural environment and human life. Economic consequences of global warming include shifts in regional production centers and adjustments of labor, capital and land allocations. Developed countries are more likely to experience positive effects and developing countries are more likely to experience negative effects. Global warming will have a serious impact on the economic growth without mitigation. It can be mitigating through 1% investment of global GDP otherwise there is a risk of recession worth up to 20 % of global GDP (Stern Review, 2006). It will also slow down economic growth and poverty reduction.
Products that releases CFC such as refrigerators, etc., automobiles, industries which uses fossil fuels as a source of energy, are contributes to global warming. With the increase in environmental awareness, some restrictions imposed on these industries. This will put pressure over the industries either to stop production of such products or to modify them. This will lead to the market failure. The green house gases emission will affect the lives of others. The greatest market failure is the climate change and the non-payment by people for the consequences of their actions (Sir Nicholas). Moreover, problem in capital and property markets reduces investment for energy efficiency. In order to correct this market failure, the government must establish a carbon price through emission regulations and taxes and promote technology. If I ...