A reading titled ‘Global Warming and Economic Externalities’ by Armon Rezai, Duncan K. Foley and Lance Taylor, that discusses greenhouse gases (GHG) as a negative externality in global markets. The reading discusses the effect of mitigation investments on the economic well being of current and future generations. It also demonstrates how equilibrium theory can correct negative externalities through the use of the Keynes-Ramsey growth model.
Students will learn about global warming, equity, and externalities. They will understand concepts such as ‘business-as-usual’ that influence market optimisation and impact climate change. Students will further learn about the market failure of climate change and the required mitigation investment to correct it.
Use this tool to help your students find answers to:
- What are negative externalities in economics?
- What are the negative externalities associated with climate change?
- How can mitigation investments correct negative externalities?
About the tool
|Tool Name||Global Warming and Economic Externalities|
|Topic(s) in Discipline||Economic Externalities, Negative Externalities, Market Failure, Keynes-Ramsey Growth Model|
|Climate Topic||Energy, Economics and Climate Change|
|Type of tool||Reading|
|Developed by||Armon Rezai, Duncan K. Foley and Lance Taylor|
|Hosted at||Research Gate|