knowt logo

Lecture_1

Introduction to Climate Change and Economic System

  • Lecture 1 Module: BUS368 The Political Economy of Global Environmental Change

Course Details

  • Course Title: The Political Economy of Global Environmental Change

  • Module Code: BUS368

  • Lecturer: Lilit Popoyan (Email: l.popoyan@qmul.ac.uk)

  • Meeting Schedule: Tuesdays, 16:00-18:00, Peter Landin: PL-302

  • Course Material: Available online at QMPlus

  • Office Hours: Tuesdays from 14:30 to 15:30, Room 2.35, Francis Bancroft Building

About the Lecturer

  • Position: Lecturer at QMUL, School of Business and Management

  • Affiliated Researcher: Institute of Economics, Scuola Superiore Sant’Anna, Italy

  • Lecturer in Money and Banking: New York University (NYU)

  • Research Interests:

    • Monetary Economics

    • Financial Regulations

    • Macro-prudential Policy and Systemic Risk

    • Climate Change and Economic Dynamics

Aim of the Course

  • Main Aim: Understand climate-economy interactions

  • Research Questions:

    • Present and future economic impacts of climate change?

    • Macro-financial implications of low-carbon transition?

    • Optimal climate mitigation/adaptation strategies?

  • Functional Objectives:

    • Expand knowledge on empirical evidence, theories, and key facts

    • Familiarize with current scientific/policy research focused on climate and economic transition

    • Develop an original critical analysis

Course Overview

  1. Introduction and big picture on Climate Change and Economic System (W1)

  2. Drivers, impacts, and scenarios of Climate Change (W2)

  3. Socio-economic impact of Climate Change scenarios (W3)

  4. Decarbonization of the global economic system (W4)

  5. Climate-related policies and commitments (W5)

  6. Climate-related financial risks (W6)

  7. Climate-related macro-financial risks (W8)

  8. Climate change and the monetary system (W9)

  9. Just transition with a guest lecturer (W10)

  10. Policy institutions addressing Climate Change (W11)

Lecture Structure and Exams

  • Structure: Eleven 2-hour frontal lectures (Lecture 11: online review session)

  • Practice Quizzes and Exam Sessions to prepare for assessments

  • Exams:

    • Midterm Exam: In-class (30 minutes), TBD, contributes 30% to final evaluation

    • Final Exam: In-class (2 hours written), TBD, contributes 70% to final evaluation

Students’ Role

  • Attend classes as content is key to passing

  • Participation encouraged: Diversity enriches learning

  • Keep questions and comments interactive

  • Arrive on time: Lectures start/end punctually

  • Maintain focus: Limited use of laptops for note-taking only, no mobile phones

Main Readings

  • No specific textbook, but suggested readings:

    • Economides et al., (2018) - "The Economics of Climate Change" (free on QMPlus)

    • Tol, R. (2019) - "Climate Economics", 2nd edition (QMPlus)

    • Keohane and Olmstead (2016) - "Markets and the Environment", 2nd edition (QMPlus)

  • Key Reading: IPCC Assessment Report 6

Key Reading Resource: IPCC AR6

  • Produced by UN Intergovernmental Panel on Climate Change (IPCC)

  • Aims to assess knowledge on climate change and societal responses

  • Key Features:

    • Overarching periodic Assessment Reports (first in 1990, latest AR6 - 2021-22)

    • Three Working Groups:

      • WGI: Physical science of climate change

      • WGII: Climate impacts and adaptation options

      • WGIII: Climate mitigation options

  • Each group publishes:

    • Summary for Policy-Makers (SPM)

    • Technical Summary (TS)

    • Full report with focused chapters

Discussion Questions

  • What comes to mind regarding "climate change"?

  • What are perceived main causes of climate change?

  • How does climate change impact global economies and societies?

Climate System Overview

  • Climate System Definition: Interconnected system including atmosphere, water, ice, land, and ecosystems

  • Existence and evolution precede human activity

  • Rapid changes observed, primarily anthropogenic in origin

  • Climate Definition (IPCC AR6): Mean statistical description over 30 years, encompassing variability

Climatic Variables of Interest

  • Temperature: Mean global temperature, changes relative to baseline, GHG impact on energy balance

  • Greenhouse Gas Concentrations: Key GHGs include CO2, CH4, N2O; affects warming

  • Hydrological Dynamics: Precipitation patterns, extreme weather events necessary for life

Studying Climate

  • Methods:

    • Paleoclimatology using tree rings, sediments, etc.

    • Instrumental observation (surface, weather balloons, satellites)

    • Dynamic modeling for future projections (CMIP)

Understanding Climate Change Dynamics

  • Recent decades show rapid changes: Unprecedented temperature increases (1.09°C since 1850-1900)

  • Other changes include sea level rise, increased extreme weather

  • Policy consensus: Limit warming to below 1.5-2°C

Anthropogenic Drivers of Climate Change

  • Growth in GHG emissions primarily from human activities

  • Major sources of GHGs: CO2 from fossil fuels, CH4 from livestock and waste, N2O from fertilizers

Adaptation to Climate Change

Examples

  • Infrastructure developments (e.g., sea walls)

  • Market adaptation (business relocations)

Policies and Challenges

  • Government investment in adaptation infrastructure

  • Many adaptation measures have long-term viability issues

Mitigation Necessity

  • Adaptation alone insufficient; emission reductions are essential

Mitigation Strategies

  • Goal: Achieve atmospheric GHG stabilization

  • Main strategies include:

    • Reducing emissions

    • Sequestering GHGs (natural and technological methods)

Global Decarbonization Project

  • Shift from carbon-based energy to carbon-free technologies

    • Examples: Transition from coal to solar, gasoline to electric vehicles

  • Historical precedents exist, but urgency and societal factors complicate transition

Implementing Transition Policies

  • Legal/regulatory frameworks needed to guide transition

  • Encouragement of behavioral changes in consumption, investments

  • Essential focus on carbon pricing and financial policies

Risks of Rapid Transition

  • Possible disruptions for firms/countries reliant on fossil fuels

  • Potential financial instability; research focus on transition risk

Collaborative Efforts in Climate Macro & Finance

  • Involvement of climate scientists, economists, and multi-disciplinary teams

  • Central banks and financial authorities emerging as key players in climate finance

Role of Economists

  • Investigate socio-economic impacts, financing low-carbon transitions, effective policies

  • Utilize methods such as econometrics and behavioral analysis

Economy-Climate Interactions

  • Interplay between economic activities and climate dynamics impacting broader societal functions

Investment Behavior Focus

  • Explore investment patterns in capital stock vs R&D

  • Consider uncertainty and various economic perspectives during decision-making

Financial System in Transition

  • External financing is crucial for facilitating green investments

  • Various actors play significant roles in capital flows and investment strategies

Concluding Remarks

  • Complex but crucial questions on climate adaptation/mitigation and economic viability

  • Emphasize interdisciplinary research and remain engaged in course materials

  • Upcoming Lecture: Drivers, Impacts, Scenarios of Climate Change

Questions

  • For inquiries, contact: I.popoyan@qmul.ac.uk

RV

Lecture_1

Introduction to Climate Change and Economic System

  • Lecture 1 Module: BUS368 The Political Economy of Global Environmental Change

Course Details

  • Course Title: The Political Economy of Global Environmental Change

  • Module Code: BUS368

  • Lecturer: Lilit Popoyan (Email: l.popoyan@qmul.ac.uk)

  • Meeting Schedule: Tuesdays, 16:00-18:00, Peter Landin: PL-302

  • Course Material: Available online at QMPlus

  • Office Hours: Tuesdays from 14:30 to 15:30, Room 2.35, Francis Bancroft Building

About the Lecturer

  • Position: Lecturer at QMUL, School of Business and Management

  • Affiliated Researcher: Institute of Economics, Scuola Superiore Sant’Anna, Italy

  • Lecturer in Money and Banking: New York University (NYU)

  • Research Interests:

    • Monetary Economics

    • Financial Regulations

    • Macro-prudential Policy and Systemic Risk

    • Climate Change and Economic Dynamics

Aim of the Course

  • Main Aim: Understand climate-economy interactions

  • Research Questions:

    • Present and future economic impacts of climate change?

    • Macro-financial implications of low-carbon transition?

    • Optimal climate mitigation/adaptation strategies?

  • Functional Objectives:

    • Expand knowledge on empirical evidence, theories, and key facts

    • Familiarize with current scientific/policy research focused on climate and economic transition

    • Develop an original critical analysis

Course Overview

  1. Introduction and big picture on Climate Change and Economic System (W1)

  2. Drivers, impacts, and scenarios of Climate Change (W2)

  3. Socio-economic impact of Climate Change scenarios (W3)

  4. Decarbonization of the global economic system (W4)

  5. Climate-related policies and commitments (W5)

  6. Climate-related financial risks (W6)

  7. Climate-related macro-financial risks (W8)

  8. Climate change and the monetary system (W9)

  9. Just transition with a guest lecturer (W10)

  10. Policy institutions addressing Climate Change (W11)

Lecture Structure and Exams

  • Structure: Eleven 2-hour frontal lectures (Lecture 11: online review session)

  • Practice Quizzes and Exam Sessions to prepare for assessments

  • Exams:

    • Midterm Exam: In-class (30 minutes), TBD, contributes 30% to final evaluation

    • Final Exam: In-class (2 hours written), TBD, contributes 70% to final evaluation

Students’ Role

  • Attend classes as content is key to passing

  • Participation encouraged: Diversity enriches learning

  • Keep questions and comments interactive

  • Arrive on time: Lectures start/end punctually

  • Maintain focus: Limited use of laptops for note-taking only, no mobile phones

Main Readings

  • No specific textbook, but suggested readings:

    • Economides et al., (2018) - "The Economics of Climate Change" (free on QMPlus)

    • Tol, R. (2019) - "Climate Economics", 2nd edition (QMPlus)

    • Keohane and Olmstead (2016) - "Markets and the Environment", 2nd edition (QMPlus)

  • Key Reading: IPCC Assessment Report 6

Key Reading Resource: IPCC AR6

  • Produced by UN Intergovernmental Panel on Climate Change (IPCC)

  • Aims to assess knowledge on climate change and societal responses

  • Key Features:

    • Overarching periodic Assessment Reports (first in 1990, latest AR6 - 2021-22)

    • Three Working Groups:

      • WGI: Physical science of climate change

      • WGII: Climate impacts and adaptation options

      • WGIII: Climate mitigation options

  • Each group publishes:

    • Summary for Policy-Makers (SPM)

    • Technical Summary (TS)

    • Full report with focused chapters

Discussion Questions

  • What comes to mind regarding "climate change"?

  • What are perceived main causes of climate change?

  • How does climate change impact global economies and societies?

Climate System Overview

  • Climate System Definition: Interconnected system including atmosphere, water, ice, land, and ecosystems

  • Existence and evolution precede human activity

  • Rapid changes observed, primarily anthropogenic in origin

  • Climate Definition (IPCC AR6): Mean statistical description over 30 years, encompassing variability

Climatic Variables of Interest

  • Temperature: Mean global temperature, changes relative to baseline, GHG impact on energy balance

  • Greenhouse Gas Concentrations: Key GHGs include CO2, CH4, N2O; affects warming

  • Hydrological Dynamics: Precipitation patterns, extreme weather events necessary for life

Studying Climate

  • Methods:

    • Paleoclimatology using tree rings, sediments, etc.

    • Instrumental observation (surface, weather balloons, satellites)

    • Dynamic modeling for future projections (CMIP)

Understanding Climate Change Dynamics

  • Recent decades show rapid changes: Unprecedented temperature increases (1.09°C since 1850-1900)

  • Other changes include sea level rise, increased extreme weather

  • Policy consensus: Limit warming to below 1.5-2°C

Anthropogenic Drivers of Climate Change

  • Growth in GHG emissions primarily from human activities

  • Major sources of GHGs: CO2 from fossil fuels, CH4 from livestock and waste, N2O from fertilizers

Adaptation to Climate Change

Examples

  • Infrastructure developments (e.g., sea walls)

  • Market adaptation (business relocations)

Policies and Challenges

  • Government investment in adaptation infrastructure

  • Many adaptation measures have long-term viability issues

Mitigation Necessity

  • Adaptation alone insufficient; emission reductions are essential

Mitigation Strategies

  • Goal: Achieve atmospheric GHG stabilization

  • Main strategies include:

    • Reducing emissions

    • Sequestering GHGs (natural and technological methods)

Global Decarbonization Project

  • Shift from carbon-based energy to carbon-free technologies

    • Examples: Transition from coal to solar, gasoline to electric vehicles

  • Historical precedents exist, but urgency and societal factors complicate transition

Implementing Transition Policies

  • Legal/regulatory frameworks needed to guide transition

  • Encouragement of behavioral changes in consumption, investments

  • Essential focus on carbon pricing and financial policies

Risks of Rapid Transition

  • Possible disruptions for firms/countries reliant on fossil fuels

  • Potential financial instability; research focus on transition risk

Collaborative Efforts in Climate Macro & Finance

  • Involvement of climate scientists, economists, and multi-disciplinary teams

  • Central banks and financial authorities emerging as key players in climate finance

Role of Economists

  • Investigate socio-economic impacts, financing low-carbon transitions, effective policies

  • Utilize methods such as econometrics and behavioral analysis

Economy-Climate Interactions

  • Interplay between economic activities and climate dynamics impacting broader societal functions

Investment Behavior Focus

  • Explore investment patterns in capital stock vs R&D

  • Consider uncertainty and various economic perspectives during decision-making

Financial System in Transition

  • External financing is crucial for facilitating green investments

  • Various actors play significant roles in capital flows and investment strategies

Concluding Remarks

  • Complex but crucial questions on climate adaptation/mitigation and economic viability

  • Emphasize interdisciplinary research and remain engaged in course materials

  • Upcoming Lecture: Drivers, Impacts, Scenarios of Climate Change

Questions

  • For inquiries, contact: I.popoyan@qmul.ac.uk

robot