Definition: Costs

In climate economics, “costs” extend beyond monetary expenditures when addressing climate change. Philosophically, costs are understood as the multifaceted trade-offs that individuals and societies bear in the pursuit of mitigating or adapting to climate change. These costs can be categorized into several key dimensions. For example:

Economic costs, encompass the financial resources allocated to climate policies, such as investments in green technologies, emissions reduction measures, and adaptation strategies. Economic costs raise questions about the equitable distribution of financial burdens and who should bear them, as well as issues of intergenerational justice.

Social costs are the impacts of climate policies on communities. These costs prompt discussions about social justice, community well-being, and the responsibilities of governments and institutions to protect vulnerable groups in society.

Ethical costs revolve around moral dilemmas and trade-offs inherent in climate decision-making. For instance, ethical costs can arise when choosing between different policies and prioritizing short-term economic gains over long-term sustainability.

Costs in climate economics demand a holistic evaluation that goes beyond financial considerations. It calls for a nuanced exploration of ethical principles, distributive justice, and the moral implications of climate policies to ensure a balanced and morally defensible approach to addressing climate change.