The Common Pool Problem or “the Tragedy of the commons”

Open Access or Non-Use Value Externalities

Unclear Property rights leads to overuse of resources.

Migratory birdsFish in the seaFrench fries?

Excludable Non-Excludable

Government Regulations◦ Fishing or hunting licenses◦ Hunting seasons◦ Protected species◦ Pollution Markets

Consumer Activism◦ Green Peace and tuna◦ The green movement

Business Actions◦ Ben and Jerry’s◦ Trader Joe’s

Example Endangered species Act:

How much Would you have to be compensated if the Grand Canyon was flooded?

External Costs: Costs of production or consumption that are borne by a third party.

(e.g. pollution)

External Benefits: The consumption or production of a good benefits a third party

3,146 Earth Scientists: “Have mean global temperatures risen

compared to pre-1800s levels?” ◦ 90% said yes.

“Has human activity been a significant factor in changing mean global temperatures?” ◦ 82% said yes.

Climatologists who are active in research showed the strongest consensus on the causes of global warming, with 97 percent agreeing humans play a role.

http://www.nrs.fs.fed.us/niacs/climate/

polardiscovery.whoi.edu

How much in carbon emissions does the U.S produce?

The U.S in 2000 produced 1,583 million metric tons of carbon from burning fossil fuel, nearly 14% more than its levels in 1990.

Transportation, mostly exhaust from motor vehicles, accounted for 515 million metric tons, or 33%. 

Electricity generation from fossil fuel burning accounts for about 33% of the U.S's carbon emissions, also.

http://www.ecobridge.org/content/g_faq.htm#emissions

Ice is melting worldwide Sea level rise became faster over the last century.

◦ Sea levels are expected to rise between 7 and 23 inches (18 and 59 centimeters) by the end of the century, and continued melting at the poles could add between 4 and 8 inches (10 to 20 centimeters).

Hurricanes and other storms are likely to become stronger.

Species that depend on one another may become out of sync. For example, plants could bloom earlier than their pollinating insects become active.

Floods and droughts will become more common. Rainfall in Ethiopia, where droughts are already common, could decline by 10 percent over the next 50 years. Less fresh water will be available.

Some diseases will spread, such as malaria carried by mosquitoes.

Ecosystems will change—some species will move farther north or become more successful; others won’t be able to move and could become extinct.

Source for climate information: IPCC, 2007

Provide Incentives

The Cash for Clunkers Program Dual Purpose:

◦ Stimulate the economy ◦ Get gas guzzlers off of the highways

Solar tax Breaks

Emissions taxes

Tiered Water Rates

Each large scale emitter of carbon will receive an “emissions” permit.

These permits can be traded. Permission to pollute will fall over time.

What are the incentives?

“The Kyoto Protocol sets binding targets for 37 industrialized countries and the European community for reducing greenhouse gas (GHG) emissions .These amount to an average of five per cent against 1990 levels over the five-year period 2008-2012.”

http://unfccc.int/kyoto_protocol/items/2830.php

Drive less Fly less Use less electricity Use less gasoline Buy less Recycle more Use transit more What else?