ABSTRACT
The discussion begins with a broad overview of the issue, including a summary of the present climate change situation and future trends, the scientific basis for climate change in the greenhouse effect, and the consequences of climate change. It then turns to presenting a basic theoretical framework for understanding the economics of climate change and the economic basis for policy interventions. The discussion then turns to describing the major strategies for dealing with climate change: mitigation, geoengineering, and adaptation. The mitigation strategy is discussed at length: the possible ways mitigation could be achieved, and how they would work. We then proceed to a discussion of using international agreements to enforce broad cooperation to combat climate change. This section begins by describing the details of two climate change agreements of historical significance: the Kyoto Protocol(1997) and the Paris Agreement (2015). It then turns to a discussion of the major political and logistical challenges to writing and enforcing agreements to mitigate GHGs. The chapter concludes with a brief discussion of an idea – recently suggested by Nordhaus – of establishing a climate club, which requires countries to adopt a carbon tax if they join, and imposes trade tariffs on them if they do not.
