Economists can save us. Just as Archimedes said he could move the world if he had a lever long enough and a fulcrum on which to place it, regulators need only find the true external costs of pollution in order to protect the planet. With that done, governments simply need to step in to make sure polluters pay and let the magic of the price mechanism do the rest. So goes the theory, but when it comes to climate change, calculating the social costs of emissions is proving tricky.
The scientific consensus is that the world is warming and the causes are man-made: of the 928 papers published in peer-reviewed scientific journals between 1993 and 2003 on climate change, none challenged that view. But the future pace of change is uncertain. The Intergovernmental Panel on Climate Change helpfully estimated that to stabilise greenhouse gas concentrations, carbon emissions needed to be priced between $70 and $290 a tonne by 2030.
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