Economic evolution and climate change

Climate change will nudge us to adopt more efficient means to allocate increasingly scarce natural resources.

Jez O'Hare/Freeport-McMoRan/Handout/Reuters
An aerial view of glaciers near the summit of the 16,000-foot Puncak Jaya mountain in the Indonesian part of New Guinea island is seen in this March 2010 handout photo. Scientists in a team led by Lonnie Thompson of Ohio State University have begun drilling ice cores at a shrinking tropical glacier in Indonesia to collect data on climate change.

Imagine a place where your Blackberry doesn't work and you don't care. A place with 1700 year old redwood trees that even your 9 year old son thinks are pretty cool. This place exists. It is called Sequoia National Park . I now know more about central California than I thought I would ever know. I'm also now a fan of the Fresno Bee. Things change.

I saw the world's biggest tree (General Sherman), we saw bears, lizards, and some fast moving rapids. We ate at the same Mexican Restaurant for 3 nights in a row and I may have permanent indigestion. I even shocked the world swimming in the motel pool with my son. I was the only dude with no tattoos. I guess I'm really uncool.

Each day, we would drive two hours roundtrip into the National Park and then hike around for 3 to 4 hours. This was too much exercise and at night I could barely move. The hotel beds were too small and the toliet had a strange smell (perhaps the upstairs motel guests?) but despite these small slights --- we still had a great time.

We returned to Los Angeles and had the pleasure of finding two dog turds in our garbage cans. I knew this would happen. Garbage cans are placed in front of our home on wednesday mornings and then the garbage trucks arrive before noon to empty them. But, we were out of town and our gardeners must have been late to roll them up our driveway so some kind dog owners were nice enough to give us their precious dogs' droppings and didn't even bother to tie the plastic bag. Nice!

I'm still caught up with this bad review that Climatopolis received. It occurs to me that I'm going to be set up as the "bad boy" of the climate change set because I do not foresee "doom and gloom" in our hotter future. For those of you who want hope and optimism, I've got it for you in abundance. Our best days are ahead of us!

I want my book to be remembered as a "neo-classical economist's vision for how an economy evolves in the face of anticipated but ambiguous risk (climate change)". We learn, we experiment and we adapt. Sink or swim baby.

To provide just one example of how economists view climate change; suppose that climate change affects Los Angeles' water supply. The introduction of floating water prices (i.e higher prices to reflect increased scarcity) would go a long way to helping us to adapt. The Economist Magazine appears to agree with me. Scarcity will actually nudge us to adopt more efficient means to allocate increasingly scarce resources (i.e water) --- adopting new rules of the game help us to escape.

Switching subjects, this article on GMO salmon is pretty interesting. If the salmon double in size, what happens to the equilibrium price? Supply has shifted out but does demand shift in or remain constant? How many people will freak out about "Frankenfood"?

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