Economics of climate change

Big feature in the Globe yesterday on the economic impacts of climate change. Some major institutional investors such as pension plans and retirement funds are asking the companies they invest in tough questions about their ‘risk exposure’ to Kyoto. They want to know how much the companies will have to spend in the future to reduce emissions, how well they are positioned to deal with shifts to alternative energy sources, and what the economic consequences will be to their investments. I think it’s quite promising to see the investment and business community ratcheting up their discource on Kyoto; it almost makes it seem like they realize it’s something they’ll have to deal with whether they like it or not.

There’s a sidebar about green investing. I know most students don’t have much money to invest but it’s still interesting to read about some of the supposedly socially/environmentally responsible investments out there.

2 Responses to “Economics of climate change”

  1. Pete says:

    Greg Mikkelson, one of the MSE profs, is circulating a petition to change the rules regarding the McGill pension to allow members to invest in a green/ethical pension option. Socially responsible pension options are standard at US universities, and tend to perform well.

  2. Frederic Fabry says:


    I just happened to have gone to one of the meetings mentioned in the Globe. There are interesting things that are afoot in terms of economy and climate change. For example, it appears that companies are starting to be looked at in terms of their CO2 emissions as well as the risk they pose to climate as well as the risk of climate on their business. Credit rating companies are monitoring these things and threatened to lower the credit ratings of companies who are exposed to the vagaries of climate change or are not managing well the new assets that are their carbon emission allowances and credits.