Environmental Cost-Benefit Analysis

Joseph Heath sometimes plays the role of a gadfly in climate and environmental ethics. He often defends conventional, economics-focused claims which rub many philosophers the wrong way—claims that are at the heart of issues raised in these pages, claims such as that discounting is justifiable, growth is good, or cost-benefit analysis is appropriate in liberal democracies. I think we can all agree that sophisticated defences of conventional positions play an important part in the ecosystem. For philosophers, a gadfly can challenge (...) entrenched conceptions. If we agree that these goals are worthwhile, then this book serves as a useful summary and synthesis of the ways Heath has ably defended conventional claims about climate policy. (shrink)

Ideal carbon tax policy is internationally coordinated, fully internalizes externalities, redistributes revenues to those harmed, and is politically acceptable, generating predictable market signals. Since nonideal circumstances rarely allow all these conditions to be met, moral issues arise. This paper surveys some of the work in moral philosophy responding to several of these issues. First, it discusses the moral drivers for estimates of the social cost of carbon. Second, it explains how national self-interest can block climate action and suggests international policies—carbon (...) border tax adjustments and carbon clubs—that can help address these concerns. Third, it introduces some of the social science literature about the political acceptability of carbon taxes before addressing a couple common public concerns about carbon taxes. Finally, it introduces four carbon revenue usage options, arguing that redistributive and climate compensation measures are most morally justified. [Open access]. (shrink)

Non-technical summary: -/- When developing and deploying negative emissions technologies (NETs), little attention has been paid to where. On the one hand, one might develop NETs where they are likely to contribute most to global mitigation targets, contributing to a global climate solution. On the other hand, one might develop NETs where they can help support development on a regional basis, justified by regional demands. I defend these arguments and suggest that they reflect the values of efficiency and responding to (...) need, respectively. To the extent that these values conflict, they introduce what I call the Need-Efficiency Trade-off Effect (‘NET Effect’). -/- Technical summary: -/- Unlike other geoengineering methods, the effectiveness of negative emissions technologies (NETs) tends to be sensitive to regional siting. This paper argues that this point raises morally and legally important implications by identifying a trade-off between ‘efficiency’ and ‘need’. First, it introduces two arguments justifying NETs: one focused on contributions to global mitigation and the other focused on contributions to regional development. Second, reflecting the two arguments, the paper discusses the moral values of efficiency and need, respectively. For instance, if the strategy is to try to use NETs to maximize expected mitigation contributions to reflect efficiency, then deployment should occur in regions with the best prospects for success (e.g. Western countries). However, if the strategy is to try to use NETs to improve the chances of simultaneous development and mitigation to respond to need, then deployment should occur in regions with limited development and expected growth of demand for NETs (e.g. Asian countries). When these values conflict, I call that a Need-Efficiency Trade-off Effect (‘NET Effect’). The paper concludes by considering the NET Effect in the context of bioenergy with carbon capture and storage as well as direct air carbon capture and storage. [Open access]. (shrink)

This teaching and learning guide accompanies the following article: Mintz-Woo, K., 2022. Carbon Pricing Ethics. Philosophy Compass 17(1):article e12803. doi:10.1111/phc3.12803. [Open access].

The three main types of policies for addressing climate change are command and control regulation, carbon taxes (or price instruments), and cap and trade (or quantity instruments). The first question in the ethics of carbon pricing is whether the latter two (price and quantity instruments) are preferable to command and control regulation. The second question is, if so, how should we evaluate the relative merits of price and quantity instruments. I canvass relevant arguments to explain different ways of addressing these (...) important policy questions, suggesting that carbon pricing is preferable to command and control regulation, and that price instruments have the theoretical edge over quantity instruments. [Open access]. (shrink)

Although policymakers and investigators still struggle to quantify and compare the effects of various Covid-related interventions, we are steadily amassing data that could help inform choices. The pandemic’s medical, social, and economic harms have been immense, and they warrant a continuous policy response. All decision makers use some type of mental model to weigh the pros and cons of various policy options. Rigorous economic evaluation formalizes this process. Value judgments will still be required, but economic evaluation can make the decision-making (...) process more systematic, comprehensive, and transparent. (shrink)

This chapter introduces several distinctions relevant to what is called the “discounting problem”, since the issue is how (future) costs and benefits are discounted to make them comparable in present terms. The author defends the claim that there are good reasons to adopt Ramsey-style discounting in the context of climate change: the Ramsey rule is robust, flexible, and well-understood. An important distinction involved in discounting—“descriptivism” and “prescriptivism”—is discussed. It is argued that, even if we adopt prescriptivism, and accept that this (...) means there is need for moral experts in parameter assignments, there is a significant issue. The type of moral expertise required for the discounting problem will not involve knowledge of moral theory—thus making moral philosophy unhelpful in terms of making particular parameter assignments, despite these being substantive moral judgments. (shrink)

This chapter qualitatively lays out some of the ways that climate change impacts are evaluated in integrated assessment models (IAMs). Putting aside the physical representations of these models, it first discusses some key social or structural assumptions, such as the damage functions and the way growth is modeled. Second, it turns to the moral assumptions, including parameters associated with intertemporal evaluation and interpersonal inequality aversion, but also assumptions in population ethics about how different-sized populations are compared and how we think (...) about distributing goods across or within times. The intention is to survey the morally important assumptions that go into estimates of the social cost of carbon, the marginal cost of an additional tonne of carbon dioxide to society. (shrink)

A question arising from the COVID-19 crisis is whether the merits of cases for climate policies have been affected. This article focuses on carbon pricing, in the form of either carbon taxes or emissions trading. It discusses the extent to which relative costs and benefits of introducing carbon pricing may have changed in the context of COVID-19, during both the crisis and the recovery period to follow. In several ways, the case for introducing a carbon price is stronger during the (...) COVID-19 crisis than under normal conditions. Oil costs are lower than normal, so we would expect less harm to consumers compared to normal conditions. Governments have immediate need for diversified new revenue streams in light of both decreased tax receipts and greater use of social safety nets. Finally, supply and demand shocks have led to already destabilized supply-side activities, and carbon pricing would allow this destabilization to equilibrate around greener production for the long-term. The strengthening of the case for introducing carbon pricing now is highly relevant to discussions about recovery measures, especially in the context of policy announcements from the European Union and United States House of Representatives. Key Policy Insights: • Persistently low oil prices mean that consumers will face lower pain from carbon pricing than under normal conditions. • Many consumers are more price-sensitive during the COVID-19 context, which suggests that a greater relative burden from carbon prices would fall upon producers as opposed to consumers than under normal conditions. • Carbon prices in the COVID-19 context can introduce new revenue streams, assisting with fiscal holes or with other green priorities. • Carbon pricing would contribute to a more sustainable COVID-19 recovery period, since many of the costs of revamping supply chains are already being felt while idled labor capacity can be incorporated into firms with lower carbon-intensity. (shrink)

The main aim of this book is to introduce the topic of limited awareness, and changes in awareness, to those interested in the philosophy of decision-making and uncertain reasoning.

[Newspaper Opinion] Before the COVID-19 pandemic and the accompanying fall in oil prices, a carbon price would have been immediately painful for the countries that imposed it, but far better for everyone over the longer term. In this unprecedented moment, introducing a carbon price would be beneficial both now and for the future.

Utility discounting in intertemporal economic modelling has been viewed as problematic, both for descriptive and normative reasons. However, positive utility discount rates can be defended normatively; in particular, it is rational for future utility to be discounted to take into account model-independent outcomes when decision-making under risk. The resultant values will tend to be smaller than descriptive rates under most probability assignments. This also allows us to address some objections that intertemporal considerations will be overdemanding. A principle for utility discount (...) rates is suggested which is rooted in probability discounting. Utility discounting is defended against objections from Parfit (1984) and Broome (2005); Broome (2012). A sample utility discount rate is estimated. [Open access]. (shrink)

Health policy is only one part of social policy. Although spending administered by the health sector constitutes a sizeable fraction of total state spending in most countries, other sectors such as education and transportation also represent major portions of national budgets. Additionally, though health is one important aspect of economic and social activity, people pursue many other goals in their social and economic lives. Similarly, direct benefits—those that are immediate results of health policy choices—are only a small portion of the (...) overall impact of health policy. This chapter considers what weight health policy should give to its “spill-over effects,” namely non-health and indirect benefits. (shrink)

Que tal um take diferente sobre os ricos e famosos? Primeiro o óbvio-os romances de Harry Potter são superstição primitiva que incentiva as crianças a acreditar na fantasia, em vez de assumir a responsabilidade pelo mundo-a norma, é claro. JKR é tão sem noção sobre si mesma e do mundo como a maioria das pessoas, mas cerca de 200 vezes tão destrutiva como o Americano médio e cerca de 800 vezes mais do que o chinês médio. Ela foi responsável pela (...) destruição de talvez 30.000 hectares de floresta para produzir esses romances de lixo e toda a erosão que se seguiu (não trivial como é pelo menos 6 e talvez 12 toneladas/ano solo no oceano para todos na terra ou talvez 100 toneladas por Americano, e assim por cerca de 5000 toneladas/ano para os livros de Rowling e filmes e seus 3 filhos). A terra perde pelo menos 1% de seu solo superficial cada ano, de modo que se aproxima 2100, a maioria de sua capacidade crescente do alimento será ido. Então há a enorme quantidade de combustível queimado e resíduos feitos para fazer e distribuir os livros e filmes, bonecas plásticas etc. Ela mostra sua falta de responsabilidade social, produzindo crianças em vez de usar seus milhões para incentivar o planejamento familiar ou comprar a floresta tropical, e promovendo a estupidez liberal convencional de 3ª supremacia mundial que está destruindo a Grã-Bretanha, América, o mundo e o futuro de seu descendente. Claro, ela não é diferente dos outros 7.8 bilhões sem noção-apenas mais barulhento e mais destrutivo. É o não livre almoço problema mandado grande. A máfia só não pode ver que não existe tal coisa como ajudar uma pessoa sem prejudicar os outros. Direitos ou privilégios dados a novos operadores em um mundo superlotado só podem escureceros de outros. Apesar dos enormes desastres ecológicos que acontecem na frente deles em todos os lugares todos os dias, eles não podem fixá-los à maternidade desenfreada de "os diversos", que representa a maior parte do aumento da população do século passado e tudo isso neste Um. Eles não têm alguma combinação de inteligência, educação, experiência e sanidade necessária para extrapolar os assaltos diários sobre os recursos e funcionamento da sociedade para o eventual colapso da civilização industrial. Cada refeição, cada viagem de carro ou ônibus, cada par de sapatos é outra unha no caixão da terra. Ele provavelmente nunca cruzou sua mente que um assento em um avião de Londres para San Francisco produz cerca de uma tonelada de carbono que derrete cerca de 3 metros quadrados de gelo marinho e como um dos superprivilegiados que ela provavelmente voou centenas de tais vôos. Não só os ricos e famosos, mas quase qualquer figura pública em tudo, incluindo praticamente todos os professores, são pressionados a ser politicamente correto, que nas democracias ocidentais, agora significa social democrático (Neomarxista-i. e., comunista diluído) terceiro supremacistas mundiais que trabalham para a destruição de suas próprias sociedades e seus próprios descendentes. Assim, aqueles cuja falta of Educação, experiência, inteligência (e senso comum básico), que deve proibi-los de fazer quaisquer declarações públicas em tudo, dominar totalmente todos os meios de comunicação, criando a impressão de que o inteligente e civilizados devem favorecer a democracia, a diversidade e a igualdade, enquanto a verdade é que estes são os problemas e não as soluções, e que eles próprios são os principais inimigos da civilização. Ver meu livros Suicídio pela Democracia 4ª Ed (2019) y outras. (shrink)

The Precautionary Principle (PP) is an influential principle of risk management. It has been widely introduced into environmental legislation, and it plays an important role in most international environmental agreements. Yet, there is little consensus on precisely how to understand and formulate the principle. In this paper I prove some impossibility results for two plausible formulations of the PP as a decision-rule. These results illustrate the difficulty in making the PP consistent with the acceptance of any trade-offs between catastrophic risks (...) and more ordinary goods. (shrink)

Climate change policy decisions are inescapably intertwined with future generations. Even if all carbon dioxide emissions were to be stopped today, most aspects of climate change would persist for hundreds of years, thus inevitably raising questions of intergenerational justice and sustainability. -/- The chapter begins with a short overview of discount rate debate in climate economics, followed by the observation that discounting implicitly makes the assumption that natural capital is always substitutable with man-made capital. The chapter explains why non-substitutability matters (...) if we are to take intergenerational justice seriously and invest aptly in mitigation. Non-substitutability simply implies that there are some forms of capital that cannot be substituted by another, and so consumption of one cannot be compensated with additional stocks of the other. The non-substitutability of critical natural capital can be defended without empirical data about preferences or the need to view the environment as a superior good, and the argument is presented through the language of keeping options open. -/- Those alive today make decisions about what natural capital to use and what to save for future. These choices are often represented as different points in a continuum of sustainability: weak sustainability is associated with a high degree of substitutability and therefore a lot of flexibility over what capital to consume, whereas strong sustainability is more stringent on substitutability. While it may be that in economical understanding weak and strong sustainability collapse into one another, philosophically the emphasis is slightly different. The chapter discusses how normative sustainability can be supported without ignoring opportunity costs and trade-offs. (shrink)

This paper distinguishes between five different approaches to social discount rates in climate change economics, criticizes two of these, and explains how the other three are to some degree mutually compatible. It aims to shed some new light on a longstanding debate in climate change economics between so-called “descriptivists” and “prescriptivists” about social discounting. The ultimate goal is to offer a sketch of the conceptual landscape that makes visible some important facets of the debate that very often go unacknowledged.

First, with respect to our personal relationship to fossil fuels, this chapter introduces arguments about whether we should or even can address our own usage of fossil fuels. This involves determining whether offsetting emissions is morally required and practically possible. Second, with respect to our relationship with fossil fuels at the national level, it discusses forms of local resistance, especially divestment and pipeline protesting. Finally, with respect to our relationship with fossil fuels at the international level, it considers two types (...) of policy. On the one hand, some have argued that we should stop most trade in oil, on the basis that most oil that is traded is not subject to the control of citizens. On the other hand, some have argued that we should price the costs of fossil fuels so that there are market incentives to avoid digging them out of the ground. (shrink)

The concept of ecosystem services is a way of visualizing the instrumental value that nature has for human beings. Most ecosystem services can be performed by more than one species. This fact is sometimes used as an argument against the preservation of species. However, even though substitutability does detract from the instrumental value of a species, it also adds option value to it. The option value cannot make a substitutable species as instrumentally valuable as a non-substitutable species, but in many (...) cases, it can add enough value to make the species more valuable than the projects that threaten its existence. (shrink)

Investments in mitigating climate change have their greatest environmental impact over the long term. As a consequence the incentives to invest in cutting greenhouse gas emissions today appear to be weak. In response to this challenge, there has been increasing attention given to the idea that current generations can be motivated to start financing mitigation at much higher levels today by shifting these costs to the future through national debt. Shifting costs to the future in this way benefits future generations (...) by break- ing existing patterns of delaying large-scale investment in low-carbon energy and efficiency. As we will see in this chapter, it does appear to be technically feasible to transfer the costs of investments made today to the future in such a way that people alive today do not incur any net cost. the aim of this chapter is to take seriously the possibility that climate change has produced an extremely intractable political problem and that we must now consider strong measures that can break existing patterns of delaying mitigation. I defend the claim that if climate change involves a stark conflict of interests between current and future generations, then borrowing from the future would be both strategically and normatively much better than the status quo. Nevertheless, I challenge the borrowing from the future proposal on the grounds that it is not in fact the powerful tool for motivating existing agents that its proponents imagine it to be. The purpose of developing this critical argument is not, however, simply to throw doubt onto the idea of borrowing from the future. If we really do find ourselves in a political context where the prospects for effective action are very poor then strategic forms of buck-passing may make an important positive contribution to avoiding dangerous global cli- mate change. Consequently, if debt financing is not as powerful of a motivational tool as imagined we still have strong reasons, I will argue, to identify other strategies that will change agents’ incentive structures. To this end, I propose an alternative form of passing on the costs of mitigation to the future that warrants consideration. (shrink)

Gary Comstock considers whether it is ethically justified to pursue genetically modified (GM) crops and foods. He first considers intrinsic objections to GM crops that allege that the process of making GMOs is objectionable in itself. He argues that there is no justifiable basis for the objections — i.e. GM crops are not intrinsically ethically problematic. He then considers extrinsic objections to GM crops, including objections based on the precautionary principle, which focus on the potential harms that may result from (...) the adoption of GM organisms. He argues that these concerns have some merit. However, they do not justify giving up GM crops altogether. Instead, they require that GM crops be developed carefully and with appropriate oversight. Comstock then presents the positive case for GM crops that he endorses. It is based on three considerations: (i) the right of people to choose to adopt GM technology; (ii) the balance of likely benefits over harms to consumers and the environment from GM technology; and (iii) the wisdom of encouraging discovery, innovation, and careful regulation of GM technology. (shrink)

By providing an explicit estimate of the harms caused by personal greenhouse gas emissions, John Nolt (in his “How Harmful are the Average American’s Greenhouse Gas Emissions?”) hopes to undermine tendencies to downplay these emissions and their impacts on global climate change. He estimates that an average American would be responsible for one two-billionth of the suffering or death of two billion people (over 1000 years). He treats this as equivalent to being responsible for the suffering or death of one (...) person. In my paper I argue that these are not equivalent, and that the former is less problematic than the latter. I end with the suggestion that, in terms of personal emissions, having fewer children is more effective than merely reducing our current emissions. (shrink)

“Since the actions I perform as an individual only have an inconsequential effect on the threat of climate change,” a common argument goes, “it cannot be morally wrong for me to take my car to work everyday or refuse to recycle.” This argument has received a lot of scorn from philosophers over the years, but has actually been defended in some recent articles. A more systematic treatment of a central set of related issues shows how maneuvering around these issues is (...) no easy philosophical task. In the end, it appears, the argument from inconsequentialism indeed is correct in typical cases, but there are also important qualificatory considerations. (shrink)

W artykule rozważam następujący problem: czy powinniśmy przykładać taką samą wagę do interesów i dobrobytu ludzi istniejących w przyszłości, jak do interesów i dobrobytu jednostek żyjących obecnie? Staram się wykazać, że traktowanie wymiaru czasowego analogicznie do przestrzennego jest problematyczne, zarówno jeśli chodzi o wymogi moralne, jak i o zasady sprawiedliwości, którymi powinny kierować się instytucje społeczne. Analizuję problem społecznej stopy dyskontowej, a także wskazuję na ograniczenia, jakie napotyka w związku z nim konsekwencjalistyczny rachunek zysków i strat w kontekście sprawiedliwości międzypokoleniowej.

Benefit/cost analysis is a technique for evaluating programs, procedures, and actions; it is not a moral theory. There is significant controversy over the moral justification of benefit/cost analysis. When a procedure for evaluating social policy is challenged on moral grounds, defenders frequently seek a justification by construing the procedure as the practical embodiment of a correct moral theory. This has the apparent advantage of avoiding difficult empirical questions concerning such matters as the consequences of using the procedure. So, for example, (...) defenders of benefit/cost analysis (BCA) are frequently tempted to argue that this procedurejust isthe calculation of moral Tightness – perhaps that what itmeansfor an action to be morally right is just for it to have the best benefit-to-cost ratio given the accounts of “benefit” and “cost” that BCA employs. They suggest, in defense of BCA, that they have found the moral calculus – Bentham's “unabashed arithmetic of morals.” To defend BCA in this manner is to commit oneself to one member of a family of moral theories (let us call thembenefit/cost moral theoriesorB/C moral theories) and, also, to the view that if a procedure is (so to speak) the direct implementation of a correct moral theory, then it is a justified procedure. Neither of these commitments is desirable, and so the temptation to justify BCA by direct appeal to a B/C moral theory should be resisted; it constitutes an unwarranted short cut to moral foundations – in this case, an unsound foundation. Critics of BCA are quick to point out the flaws of B/C moral theories, and to conclude that these undermine the justification of BCA. But the failure to justify BCA by a direct appeal to B/C moral theory does not show that the technique is unjustified. There is hope for BCA, even if it does not lie with B/C moral theory. (shrink)

Since the last ice age, when ice enveloped most of the northern continents, the earth has warmed by about five degrees. Within a century, it is likely to warm by another four or five. This revolution in our climate will have immense and mostly harmful effects on the lives of people not yet born. We are inflicting this harm on our descendants by dumping greenhouse gases into the atmosphere. We can mitigate the harm a little by taking measures to control (...) our emissions of these gases, and to adapt to the changes by, for instance, building sea walls around coastlines threatened by rising sea levels. But these measures will be very expensive, and the costs will be born by us, the present generation, whereas the benefits will come to future generations. How much should we sacrifice for the sake of the future? Economists and philosophers have independently worked on the question of our responsibility to future generations. This book brings their work together and applies it to global warming. It suggests a programme for future research on the economic and ethical issues. The book is intended for economists, and for philosophers and other social scientists who have a little knowledge of economic methods. (shrink)