Jorgenson on Carbon Tax, Harvard Magazine
Time to Tax Carbon: Enhancing environmental quality
and economic growth
Excerpted from Harvard Magazine, September-October 2014, by Jonathan Shaw
Next year, representatives from nations around the world will meet in Paris to discuss a global climate-change agreement that would take effect in 2020. Central to those discussions will be setting a price on carbon and its equivalents—a figure that captures the social costs of releasing greenhouse gases into the atmosphere. The impacts of those emissions range from the health effects of burning fossil fuels, to inundation and adaptation of coastal cities threatened by rising seas, to extinction of plant and animal species as a consequence of rapidly changing environmental conditions. These costs amount to nearly $1.6 trillion annually worldwide, based on Yale scholars’ estimates of the damages at $44 per metric ton of CO2 and 2013 emissions of 36 billion metric tons.
As the no doubt fraught scientific and political discussion in the French capital nears, the work of Morris University Professor Dale Jorgenson, an economist known for his ability to marry theory and practice, is especially important. Jorgenson has studied the factors that drive economic growth, the relationship between energy and the environment, and the effects of tax policy on both. His 2013 book, Double Dividend: Environmental Taxes and Fiscal Reform in the United States, is the first to examine what would happen if revenues from a carbon tax—based on the price of carbon that will be the subject of debate in Paris—were recycled into the nation’s economy. (Read More)
Portrait by Jim Harrison. Photograph copyright Les Stone/Corbis Images