Technical Progress and Global Warming: The case for a technology policy

Dennis Anderson

Published: September 2000

The case is argued for a larger and more explicit role for technology policies in responding to climate change. Policies and institutions set up during the Cold War arms race could be reformed and redirected towards the goal of making renewable energy a viable competitor to carbon-emitting fuels. Putting more resources into such projects would not only reduce their cost through economies of scale and scope, but could raise the possibility of a technological shock which meant that the cost of transition to “non-net-carbon-emitting” technology could actually be negative. Anderson argues that in any case the transition costs would probably be small, and that the process would be to the advantage of developing countries, who typically have a five to one cost advantage over the developed world in non-carbon-emitting energy production.