It’s now almost certain that 2015 will be the warmest year ever recorded. However, rather than reduce greenhouse gas emissions—something that has to happen quite urgently in order to avoid crashing through the safety barrier of 2 degrees Celsius (C) (35.6 degrees Fahrenheit (F)) warming—we continue to pump more into the atmosphere.
Thus far, the collective international response to climate change has been similar to a frog passively sitting in a heated pan of water. We are in danger of being cooked alive from inaction.
We will have to wait and see if the latest and largest U.N. climate change summit in Paris will buck this trend and produce effective responses to climate change. Previous meetings have exposed a bewildering spectrum of issues, concerns, vested interests, and general political dysfunction. By comparison, the physical science of climate change is simple.
Why has it proved so difficult to agree to limit carbon emissions?
One reason stems from the fact the Earth’s atmosphere is a public good, just like street lighting, schools, or public parks. A public good is non-rivalrous in that my use of it does not reduce yours or anyone else’s access to it. A stable climate is a global public good as it is something all of humanity enjoys. We all, to a greater or lesser extent, affect it too. It makes no difference if carbon dioxide is released in Beijing, Birmingham, or Baltimore.
If the atmosphere is a global public good then, in the absence of enforcement via international law to limit carbon emissions, you may conclude we are doomed. There is nothing to stop someone from emitting more than their fair share—this is the free-rider problem.
If enough people act selfishly (and much of economic theory begins with the assumption that humans are self-interested), then the Earth’s sinks for carbon pollution will be swamped and dangerous climate change will ensue. This would be an example of a tragedy of the commons, which has become an influential feature of Western economic thinking since the latter half of the 20th century. However, the situation is perhaps not quite so clear cut.
Can We Avoid Climate Tragedy?
In 2009, U.S. political scientist Elinor Ostrom received the Nobel Prize in Economic Sciences for her work on the management of public goods and common-pool resources. What Ostrom established is that, contrary to certain grim predictions, there are numerous examples of effectively managed public goods: Nepalese forests, American lobster fisheries, community irrigation schemes in Spain, and many other systems are looked after sustainably through following a combination of eight principles.
Ostrom’s Eight Principles for Managing a Commons:
1. Define clear group boundaries.
2. Match rules governing use of common goods to local needs and conditions.
3. Ensure that those affected by the rules can participate in modifying the rules.
4. Make sure the rule-making rights of community members are respected by outside authorities.
5. Develop a system, carried out by community members, for monitoring members’s behavior.
6. Use graduated sanctions for rule violators.
7. Provide accessible, low-cost means for dispute resolution.
8. Build responsibility for governing the common resource in nested tiers from the lowest level up to the entire interconnected system.
The implications are profound. Rather than assume the market or central control are the most effective mechanisms to manage goods and services, Ostrom showed that groups of people can self-organize around common interests.
