Determinants of Belief – And Unbelief – In Climate Change

Climate change is a most serious challenge. Committing the needed resources requires that a clear majority of citizens approves the appropriate policies, since committing resources necessarily involve a trade-off with other expenses. However, there are distinct groups of people who remain in denial about the realities of climatic change. This chapter presents a range of psychological and social phenomena that together explain the phenomena that lead to denial.

Climate Catastrophes as a Sum of Known Risks

An ever-increasing body of research has warned for decades about the impacts of climate change on agriculture, health, flooding, economy, among many others and provided information about when and where these impacts could be larger. Are societies prepared for these expected ‘white-swans’, particularly in the context of a high degree of interconnectedness in Nature and in society? I borrow from the development of the Covid-19 pandemic to illustrate this view. Influenza pandemics have been foreseen decades before, but the characteristics of the virus and the socioeconomic links have made it into the global crisis that it had become in 2020.

Corporate Taxation in a Circular Economy

A circular economy leads to challenges for the system of corporate taxation. However, there exist already a legal rationale for the levy of corporate tax in a circular economy. Such a rationale, a convincing raison d’être for corporate taxation in a circular economy, contributes to the legitimacy for a green corporate tax. I explore some new measures in corporate taxation that are consistent with a circular economy.

Introduction and Lessons Learned

This chapter introduces the theme of the book and gives an overview of the lessons learned from the individual chapters.

Climate Change in the Attention Arena of the Middle Class

Good intentions by the middle class are not always well guided and do not always lead to measurable or significant results. For example, efforts to limit greenhouse gas emissions may hold broad appeal but can still have negligible impact. Therefore, it is suggested to embark on “Apollo projects”, which bundle the potential and willingness of the middle class. These projects should focus on the development of specific technologies, with economic advantages to support their spread throughout the world. Doing so will harness the middle class in support of greenhouse gas emission reductions in the gigaton-range. Such pan-national projects, for example, could address emission-free ship- or air-propulsion, the electrification of heating or of processes in the chemical industry.

The Green Challenge for Central Banks and Households

Central banks should not be excluded from the list of responsible institutions to address climate change. They already have a bias in their balance sheets toward polluting industries, which should be reduced. Next, the government should design green policies that do not overburden middle class households.

Perceptions of Catastrophic Climate Risks

Many climate change-related risks, such as more frequent and severe natural disasters, can be characterised as low-probability/high-consequence (LP/HC) events. Perceptions of LP/HC risks are often associated with biases which hamper taking action to limit these risks, such as underestimation of risk, myopia, and the adoption of simplified decision heuristics. This chapter discusses these biases and outlines key elements of policies to overcome them in order to enhance climate action.