“We, together with most economists, would be fine with either carbon taxes or caps, done correctly.”

What, you might frequently wonder, is geoengineering? If you’re a scifi fan, you’ll know terraforming is shaping the earth’s surface. Geoengineering refers to using similar techniques on Earth, usually particularly in reference to controlling the temperature. The release of particle such as sulfate aerosols help block sunlight from reaching the earth, similar to the effect of the eruption of volcanoes: in 1815, the eruption of Tambora encouraged Mary Shelly to spend her summer holiday indoors, writing Frankenstein. You may think this is better than sliced bread, or absolutely crazy, solving a symptom rather than the disease. Economics, though, says that what you think doesn’t really matter: since geoengineering is relatively easy, so much so it could be done by a single country, it will be hard to stop someone from doing it, whether a rogue climate engineer or Vanuatu as it gradually submerges beneath the waves.

Climate Shock looks at the insights economics can provide as we try to understand and prevent climate change. In particular, it focuses on the economics of uncertainty – how we deal with things when we are unsure of them – and externalities – how people decide to do things when the decision will affect others. Geoengineering is a classic externality (as are carbon emissions): if someone decides to release chemicals into the air because they’re too hot, everyone is affected.

The uncertainty relates to the fact that we really don’t know the potential outcomes of warming. In the Pliocene era, carbon dioxide levels were similar to today, but the seas were 20 meters higher, and Canada had camels. We don’t know how likely that is to happen again, but we probably want to avoid it (unless you’re a camel).

The book is a great survey of some economic insights for global warming, and Martin Weitzman in particular is a titan in the field. My only comment is I suspect it would struggle to convince anyone who isn’t already a believer. If you’re looking to arm yourself with facts about warming to argue with your friends, it’s a great resource: if you’re not sure what to think, less so. Some of their arguments also feel a little hasty, not really engaging with other perspectives. David Friedman, for example, argues that uncertainty cuts two ways: global warming could also end up being good for the world, as well as bad. I’m not sure I find that convincing, but I would have liked to see Climateshock rebut or acknowledge it.  Their final point, however, is a good one: even if everyone agrees that carbon emissions are immoral, and that in itself is unlikely, the immediacy of the problem means taking the economics of it seriously.

You can see more reviews and buy it on amazon here: Climate Shock.