Chapter 3, "The Public Governance Challenge"

This chapter examines the features of the climate problem that make an adequate government response difficult.

It notes the advantages of a government carbon price but concludes that adoption and implementation of an adequate carbon price is unlikely over the next decade. The challenges posed by the climate problem have been addressed elsewhere, and this chapter focuses on several additional conceptual barriers. The first is the assumption that adequate government responses can be adopted in time, which crowds out interest in complementary initiatives. These initiatives also confront additional biases, including panacea bias, which induces experts to reject responses that do not offer a complete solution. Similarly, experts are susceptible to negative spillover bias, which leads them to assume that private initiatives will displace government measures. The one percent problem—the tendency to dismiss the importance of small sources—also is a barrier, since climate change is caused by a collection of sources that contribute a small share to global or national emissions. The chapter concludes that these conceptual barriers, combined with the other commonly-discussed features of the climate problem, suggest that government measures alone are unlikely to yield an emissions pathway consistent with 3°C, much less the 2°C goal of the Paris Agreement.