Global Warming and Government Policy Measures- MyAssignmenthelp

Question: Discuss about theGlobal Warming and Government Policy Measures. Answer: Introduction Global warming is an environmental problem in economics that is caused by the emission of harmful carbon dioxide gases in the air. This is mostly from production of coal and the use of unleaded oil. Unlike other types of pollutions that face the polluting economy, greenhouse gas emissions is a global issue as the impacts are evenly dispersed across the globe (World-nuclear.org, 2017). This is the reason why the policy implementation requires international agreements and collaborations. The paper shall consider to know why some economies may not be willing to collaborate using clean power plan. A country like Alabama depends on coal for most of its energy production and thus contribute to great emissions (Lewis, Bryant, and Hansen, 2017). The use of petroleum has increased in the modern period and has greatly contributed to global warming (Hansen and Sato, 2012). This paper will identify the several causes of this issue and identify the various policy actions that the government have implemented in lowering the release of carbon dioxide into the atmosphere. Thus this paper will confirm that there is a great importance for the global warming issue to be resolved by every means possible. The paper will analyze the possible negative impacts that have occurred and those that many occur in future if the policy actions were not to be put in place. The change in global temperature has been argued to be close to 1oC. This has been argued to be as a result of global industrialization which has resulted in increased emission of greenhouse gases. The paper shall consider how the carbon dioxide gas has changed in concentration on the air and how the global temperature has changes. This analysis will be done on a time frame of more than 100 years. Since several policies will be analyzed, conclusion on the best policies between the market-based program and regulation will be drawn. The paper will thus be important for the formulation of future policies. Economics of Global Warming The earths temperature has gone up to high levels as compared to 100 years ago. Initially the increases in temperature were believed and actually were only from natural causes. The current period is a period where the human actions are argued to be responsible for increased temperatures (whatsyourimpact.org, 2017). Increment in temperatures initially could be resolved without any intervention, but currently, actions has to be taken since the adjustment sometimes take place at a slow rate. This has distorted the climate system such that rainfall seasons that occurred at a specific time of the year have shifted or rain could fall heavily at a period when its not expected and little when its expected. This has had great impacts on agricultural activities since it has become difficult to time the planting period. According to MacMillan (2016), the transportation sector is a major source of carbon gases emissions from the burning of fossil fuels. The problems of sufficient sources of ener gy is responsible for increased carbon emissions. A country such as Alabama that depends on energy as its major source of energy is not willing to collaborate on the use of clean power plan. It is worried that this would in turn create an energy shortage. Human activities such as burning of fossil fuel and deforestation have been noted to be the major factors behind global warming (Ichoku, 2017). Biologically, plants use carbon dioxide to make their food. This explains why there is more rainfall in forested areas than in areas with less plants. In forested areas, the impacts of carbon dioxide is lowered since plants use it and release oxygen. However, when the plant population is small, most of the greenhouse gases emitted goes to the air and forms a cloud above the earths surface that acts as a blanket such that the earth retains some of the heat received from the sun (Denchak, 2016). The major recorded impacts of global warming is rising sea levels resulting from melting of ice, glaciers and permafrost. Major researches has provided information that people have cleared and burnt many forests to create land for farming; this has been mainly to the increased food demand since the world population is growing at a fast rate. If global warming is not to be controlled, weather patterns would change and this may create permanent deserts in some areas whereas other areas may be made wetter and constituted by flooding. This may not be good for the drier economies or rather even the flooding economies. This would create a food shortage problem that may need a high government spending in an attempt of ensuring that there is sufficient food supply. The research by Whatsyourimpact.org (2017) noted that global warming has affected both the human society as well as nature and more negative impacts will be experienced in future is the global temperatures continue rising. According to Denchak (2016), come 2100 century, the global temperature will be very high. Graph: Changes in carbon dioxide concentration on the air over the century Source: Bbc.co.uk (2017) Graph: Changes in global warming over the century Source: Bbc.co.uk (2017) As it can be observed from the two graphs above, there is a similar trend in the change in the concentration of co2 in the air and the change in global temperatures. The increase in co2 can thus be deducted to be responsible for global warming. This is an explanation as to why most economists focuses on the policies of lowering the co2 concentration in the air when attempting to lower the global temperatures (Randers, 2017). Public Policies Towards the Reduction of Global Warming Global warming may not be solved through public policies alone. According to Ball (2010), if everyone was to become responsible such that everyone reduces his/her carbon emissions, and helping the poor to fight global warming, this in addition to public policies would help in reducing greenhouse gas accumulations. There are many public policies put in place to help in solving the global warming problem. Pigouvias Tax One of such policy is encouraging the imposition of carbon tax. This is an extra cost to the production process and it discourages high production level that results in massive carbon emissions. This tax is meant to make the producers responsible for the externalities they cause to the environment. Without the imposition of this tax, producers will produce output at their profit maximization level by ignoring the impacts on the environment resulting from their overproduction. Graph: Pigouvias Tax Source: Gallego (2017) If the firms are allowed to operate freely without governments intervention, they would produce a high quantity level QA which would involve a lot of emissions. This is at the point where their marginal benefit (MB) equates the Marginal Private Cost (MPC); the price and cost level is PA. an imposition of a Pigouvias tax forces the firms to produce at the point where the MB equates the Marginal Social Cost (MSC) and the new marginal private cost rises to MPC; the new price and cost level is at PS and the quantity produced is QS. Subsidy The government may take another action that may work similar to the tax. It may pay a subsidy equal to the green area labelled s in the diagram above. It does this with an agreement that the firm will produce quantity QS and thus avoid emissions. Auction Pollution Permits This has similar effects to the Pigouvias tax scheme. This involves the selling of permits to the emitting firms. This requires the government to know who the emitting firms are and also their production quantities. The government then makes an announcement that its selling permits for emission but specifies the output level associated with that emission level. This just like the Pigouvias tax scheme achieves an efficient emission level. Firms after receiving the announcement bids for these emission rights and they are sold to the highest bid. With a tax scheme, the government is required to have information on the marginal benefits and marginal private costs. The absence of this information creates uncertainty of the extent at which the emission level is going to fall when an emission tax is imposed. This make the auction pollution permit superior to the Pigouvias tax scheme as it lowers future uncertainty of the ultimate emission level will be. The Difference between Pigouvias Tax and Auction Pollution Permits When a Pigouvias tax is imposed, the government is not aware of the pollution that the firms will generate, but the firms are aware of the prices they will pay. On the other hand when an auction pollution permit is sold, the government knows the emission amount but the firms do not know the price they will have to pay. This explains why Pigouvias tax is not commonly used but some economies apply the auction pollution permits policies. Regulation Another policy is the creation of a green economy. Climate scientists argue thatcarbon dioxide and every other greenhouse gases emissions are harmful to the environment and it is thus a high time for policies to be implemented that will help in preventing the global climate from further damage. If business are to continue being operated as usual, the global temperatures are projected to continue rising which is posing threat to the world falling into an apocalyptic situation. In order to avoid this apocalypse, our economy has to be discourage from fossil fuels use and coal above all (Krugman, 2010). The solution towards the changing climate as agreed by many environmental economists is to use market-based programs that involve putting a price on carbon emissions to limit their level of emissions. Modest results can be observed if these programs were implemented as argued by Krugman (2010). However, he noted that there is an issue of determining the rate at which the programs should b e implemented; either immediately or gradually. Under regulation legal sanction threats are used to ensure that when the government orders the polluters to cut their emission level; they cut their emissions as ordered. There are two classes of regulations used in controlling pollution. One is the direct regulation that involves the setting of a critical level of pollution. This is followed by continuous monitoring to ensure that the emitting companies observes the set standards and if not they get prosecuted. The other category is input regulation where the government regulates the production process. Since its difficult and most expensive to monitor whether firms are observing the emission standards, governments usually use the input regulation method. This is because its easier for the government to monitor inputs. It is argued that firms are in a better position to identify the best means to lower their emissions than the government could. Thus, if the government regulates their input, it would also be regulating their output l evel at the desired level. The scope for creativity and flexibility is absent when direct regulation is used. Even though it may be effective in some cases, it may have no positive results in some other cases. Conclusion The greenhouse effect is a useful part of the environment since the gases traps heat from the sun and radiate it back to the earth when the sun is gone and thus provide warmth necessary for supporting life on earth. Otherwise the earth would be so cold and would not support life. However, when an accumulation of the greenhouse gases in very intensive, it prevents harmful radiation rays from the sun from reflecting back. This results in exposing the earth to harmful diseases such as cancers and many others. The change is weather patterns has also affected food productions since it has resulted in some places becoming more dry and others to experience floods. There is high importance for implementation of policies that could help in lowering the level of greenhouse gas emissions in order to prevent a further global temperature rise in the future. The study has covered both the market-based policies and those for regulations. The argument by many economists most importantly as argued by Krugman were that the best results on the reduction of greenhouse emissions would be obtained by the implementation of market-based programs rather than the use of regulations. The market-based programs are used for ensuring that the emitters pay or rather suffer additional costs from their behaviors of carbon emissions. This would make them become more cautious and may avoid some production practices that results in huge emissions. The other possible action they would take is to lower their production level so as to emit less carbon and thus pay less carbon tax. In the case of regulation we have seen that there is the absence of the scope for creativity and flexibility when direct regulation is implemented. The outcome delivered by the free market operations is not always fairs and thus government intervention is important. Negative externalit ies are some of the problems experienced from free market operations. 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