In other words, solving climate change was a prisoner’s dilemma, where each country had individual incentives that worked against the world’s. Scholars, including William Nordhaus, the Nobel-Prize-winning Yale economist, spent a tremendous amount of time trying to finesse the free-riding problem. Outside of an international agreement, the problem seemed intractable.
A changing climate, a changing world
Climate change around the world: In “Postcards From a World on Fire,” 193 stories from individual countries show how climate change is reshaping reality everywhere, from dying coral reefs in Fiji to disappearing oases in Morocco and far, far beyond.
But about a decade ago, something began to change. Rich countries grew their economies, but saw their emissions fall. China, which emits more climate pollution than any other country, reaped enormous economic and strategic benefits from its booming green-technology industries. And the world began to understand that climate action was not in fact a trade-off — cutting emissions does not mean giving up on growth. In fact, low-carbon technologies, especially batteries and renewables, are the future of the economy; they can generate energy more cheaply and support human flourishing at lower cost than the fossil fuels and combustion engines that they replace.
In 2020, the political scientists Michaël Aklin and Matto Mildenberger showed that based on the historical evidence, countries haven’t backed off on their climate commitments when their neighbors have. Instead, what dictates climate policy is political competition within countries — domestic coalitions vying for power over society and the economy. Climate policy generates “new economic winners and losers,” Aklin and Mildenberger wrote, and countries pass more of it only when the winners have the upper hand.
You can see this now as America and Europe fuss over their respective climate policies, and exactly how profits and future growth should be divided among manufacturers, fossil-fuel companies, workers and consumers. Meanwhile, executives, activists, lobbyists and officials have their own ideas about how the economy should be run , and these, too, shape the outcome.
Last year, Jonas Nahm at the Johns Hopkins School of Advanced International Studies,observed that countries with export and manufacturing-oriented economies, such as Germany, adopted national climate policies before import-dependent countries did. Manufacturers and their political allies saw the opportunity in green technology and pushed politicians to seize it, he reasoned.