Economics and the climate catastrophe

ABSTRACT

The acute awareness of scarcity, land rent, fixed costs and environmental limits that characterized the classical period was largely forgotten during the hey-day of neoclassical growth economics. Awareness has now returned, and many scientists and engineers are devoting themselves to these issues. But a revolution in economic thought, bringing economics into line with biophysical principles and the challenges of climate change, consistent with the laws of thermodynamics, has not occurred. The paper closes with examples of the application of basic principles to the policy choices that lie ahead, and some suggestions for the future of economics.

KEYWORDS:

• Scarcity
• fixed cost
• climate
• biophysical economics

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

James K. Galbraith

James K. Galbraith holds the Lloyd M. Bentsen Jr Chair in Government-Business Relations at the Lyndon B. Johnson School of Public Affairs, The University of Texas at Austin.