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> Here’s how I think about it: you may feel free to criticize, this is meant to get people thinking, not as an implementable policy. > Draw a control volume ar

> Here’s how I think about it: you may feel free to criticize, this is meant to get people thinking, not as an implementable policy. > Draw a control volume around your business or product. If, during the creation, use, or disposal of your product or business, mass or energy crosses this boundary, you should be required to provide for any negative externalities caused by this material or energy. > Of course, as usual with this approach, the magic is all in the drawing of the boundary, but hear me out. > Under this framework, it may be a bit easier to see clearly what externalities we might wish to price. I sincerely believe that if we now shrink from this present task of properly pricing and managing these costs, human society will perish from this earth. Not all negative externalities demand restitution. If you make a better widget, another firm may lose market share and their stakeholders would be harmed. This obviously shouldn't require restitution. Also, it's very hard to measure both positive and negative externalities.

torpfactory 8y ago
Why shouldn’t all negative externalities require restitution in proportion to their harm? I couldn’t agree more that it is difficult to measure externalities. A good place to start might be to get a quote for the cost of undoing the harm - e.g. I’ve heard as low as $93 a ton to remove carbon dioxide from the atmosphere. Seems like a reasonable starting point for discussion. By the way I don’t think making a better widget qualifies as a negative externality.
- Eridrus 8y ago
  For a more concrete widget example: self-driving cars will have negative externalities on professional drivers. I'm not sure what definition of externalities includes climate change, but not job losses. I also think it's a bit simplistic: what if we find that the carbon energy sector is not capturing all the value of what it provides and has positive externalities that outweigh the negatives at current levels? What do you do about systems with non-linear effects like the climate? I think we shouldn't try and seek a general operating principle from a known hard problem that we are failing to address and is pretty different from others we face. We should have a carbon tax, because it is a useful tool in fighting this battle, not because it is the right tool for every issue.

torpfactory 8y ago

Why shouldn’t all negative externalities require restitution in proportion to their harm? I couldn’t agree more that it is difficult to measure externalities. A good place to start might be to get a quote for the cost of undoing the harm - e.g. I’ve heard as low as $93 a ton to remove carbon dioxide from the atmosphere. Seems like a reasonable starting point for discussion. By the way I don’t think making a better widget qualifies as a negative externality.

Eridrus 8y ago
For a more concrete widget example: self-driving cars will have negative externalities on professional drivers. I'm not sure what definition of externalities includes climate change, but not job losses. I also think it's a bit simplistic: what if we find that the carbon energy sector is not capturing all the value of what it provides and has positive externalities that outweigh the negatives at current levels? What do you do about systems with non-linear effects like the climate? I think we shouldn't try and seek a general operating principle from a known hard problem that we are failing to address and is pretty different from others we face. We should have a carbon tax, because it is a useful tool in fighting this battle, not because it is the right tool for every issue.