Gernot Wagner joined JFI for a virtual research session on the key debate around carbon pricing and parallels with the COVID-19 pandemic. Gernot is a clinical associate professor at NYU’s Department of Environmental Studies, and an associated clinical professor at NYU Wagner School of Public Service. He was also the founding executive director of Harvard’s geoengineering research program, and previously a lecturer at Harvard on environmental science and public policy.
Gernot explained the main difficulties with carbon pricing methods, namely that a basic benefit-cost analysis of the cost of carbon compared to the benefits of averting climate change risks over time is difficult to measure. Similar to COVID-19, the growth rate is central to the ultimate, and potentially permanent effects of climate change. The rapid growth rate of COVID-19 was essential to consider in order to avert its greatest potential impacts. In much the same way, the risks of climate change, and thus the cost of carbon, Gernot argues, must account for the extreme costs of not averting a rapid increase in earth temperatures.
For a fuller understanding of Gernot’s point, see his recent article in Project Syndicate. He says, “A good way to think about the coronavirus pandemic is that it is like climate change at warp speed.”
We were extremely grateful to Gernot for joining us for a fascinating talk in an important time for his research. Also see Gernot’s piece on calculating the true price of carbon, based on his book Climate Shock, co-authored with Martin Weitzman. See more on his website here.