Send us a text

Find the clean transcripts on my Substack: https://substack.com/@climateeconomicswitharvid

Could market forces be the key to solving one of the world's most pressing public health crises? The evidence from India's groundbreaking air pollution markets suggests a resounding yes.

Air pollution in India has reached catastrophic levels. With 74 of the world's 100 most polluted cities located there, the average Indian loses 3.5 years of life expectancy to dirty air. In Delhi, that number climbs to a staggering 8 years. As the country pursues ambitious economic growth targets, balancing development with environmental sustainability has become its central challenge.

In this enlightening conversation with Dr, Kaushik Deb, Executive Director of EPIC India at the University of Chicago, we explore how emissions trading systems are transforming environmental regulation in unexpected ways. The world's first particulate pollution market in Surat, Gujarat has produced remarkable results: nearly 100% compliance (versus 64% under traditional regulation), 20-30% lower emissions, and 11-12% cost savings for participating industries.

What makes these markets so effective? Modern technology enables continuous emissions monitoring rather than sporadic inspections. Industries that reduce pollution below standards can sell their excess permits, creating financial incentives for environmental stewardship. Perhaps most surprisingly, the market transforms traditionally adversarial relationships between regulators and industry into cooperative partnerships.

The success has sparked rapid expansion throughout India. While the initial market took nearly 15 years to implement, new markets are now being developed in just 18 months. Combined SO2 trading programs across multiple Indian states could soon constitute the world's largest cap-and-trade system. The upcoming Emissions Market Accelerator initiative aims to make these proven solutions available globally as "plug-and-play" systems deployable within months.

Listen to discover how market-based approaches are demonstrating that environmental protection and economic growth can go hand in hand—and how solutions pioneered in the Global South are challenging assumptions about environmental governance worldwide.

For questions, comments or suggestions, you can contact me at [email protected]

Send us a text

Pricing carbon is the backbone of climate cost-benefit analysis in the U.S. If the price is high, stronger environmental rules pay for themselves; if it’s low, they don’t. In this episode, I trace how the social cost of carbon entered federal policy and why the number has shifted between administrations.

What we cover

• From Reagan-era cost-benefit rules to a 2007 court case that rejected “carbon = $0”
• The Obama team’s Interagency Working Group and a unified SCC built from leading IAMs
• Trump’s shift to domestic-only damages and 7% discount-rate sensitivities — and what that does to the math
• Biden’s restoration and EPA’s 2023 update: modern damage modules, mortality, and a ~2% near-term discount rate
• Trump's second term executive order which essentially put the SCC at zero.
• The discount-rate intuition: how $1,000 of damage in 100 years becomes $52 (3%), $138 (2%), or $370 (1%) today
• What a better SCC means for agencies, investors, and reciprocity in global climate policy

#ClimateEconomics #Regulation #SCC #PublicPolicy #Podcast

For questions, comments or suggestions, you can contact me at [email protected]

Send us a text

A plain-English tour of how economists put a price on climate harm—the Social Cost of Carbon—and a quick way to estimate damages with just a few numbers. 

We start from 2023 anchors (≈4.7 tCO₂ per person; ≈38 GtCO₂ worldwide), explain SCC and how U.S. administrations have used very different values, and compare with recent EU carbon-permit prices. 

Using a €100/ton example, we translate emissions into ~€500 per person per year and ~3.8% of global GDP, then show how the result scales if you think the SCC is higher or lower. 

We also touch on non-CO₂ gases (raising the average to ~6.7 t CO₂-e per person), big regional differences (China, U.S., India, EU, Africa, South America), and the long view (~1.8 trillion tons emitted to date).

Sources:

* Emission statistics obtained from https://ourworldindata.org/co2-emissions . See the graphs on Annual CO2 emissions,  share of global CO2 emissions and cumulative emissions.

* Population statistics from https://www.worldometers.info/world-population/world-population-by-year/

* World GDP of a 100 trillion https://www.macrotrends.net/global-metrics/countries/wld/world/gdp-gross-domestic-product with a conversion of around 1 dollar to 1 euro in 2023

* SCC: Obama administration’s value used from the reinstatement by Biden adjusted for inflation: https://www.rff.org/publications/explainers/social-cost-carbon-101/

For questions, comments or suggestions, you can contact me at [email protected]

Send us a text

Carbon credit offsets sound great in theory. But how well do they actually work in practice? In this new episode of my podcast, I talk with Dr. Benedict Probst about one of the largest reviews ever done on the effectiveness of carbon credit offsets, which covers over 1 billion credits across dozens of studies.

We discuss what his research says, why less than 16% of credits were found to be effective, and what this means for future climate policy, especially as the EU considers offsets in its 2040 targets.

Content includes:

01:08 – What are carbon credit offsets? Definitions and categories

04:15 – A brief history of offsets: Kyoto, voluntary markets, and compliance systems

10:40 – The meta-study: what Dr. Probst and his co-authors did, and why

15:58 – Key result: only 16% of credits represented actual emission reductions

18:02 – Wind projects had a 0% effectiveness: they look good on paper but perform poorly on additionality

23:50 – Forest management projects and “adverse selection”

26:24 – Cookstoves: lessons in behavioral assumptions

30:22 – Chemical gas destruction: high efficiency but with potential perverse incentives

33:39 – Policy risks: how offsets could potentially undermine EU goals

37:10 – Article 6.2 vs. 6.4 of the Paris Agreement: Potential and pitfalls

Sources:

* The paper: Probst, B.S., Toetzke, M., Kontoleon, A. et al. Systematic assessment of the achieved emission reductions of carbon crediting projects. Nat Commun 15, 9562 (2024). https://doi.org/10.1038/s41467-024-53645-z. https://www.nature.com/articles/s41467-024-53645-z (free to download)

* Dr. Probst’s website:  https://www.netzerolab.science/

* Politico article providing information on the Commission's proposal to meet up to 3 percentage points of the new target with international carbon credits: https://www.politico.eu/article/eu-comission-climate-target-2036-plan/

#ClimateEconomics #CarbonMarkets #Offsets #ClimatePolicy #Sustainability #ClimateScience #Podcast

For questions, comments or suggestions, you can contact me at [email protected]

Send us a text

Air pollution is responsible for shortening global life expectancy by more than two years—making it the world’s leading threat to human health, ahead of HIV/AIDS, malaria, and even smoking. Yet it receives only a fraction of the funding and policy attention.

In this episode, Dr. Christa Hasenkopf breaks down why air pollution is such a silent but devastating force—especially in the Global South—and what can be done to fight it. From real-time data sharing in Mongolia to clean air markets in India, she explains how small interventions can catalyze big change.

Dr. Christa Hasenkopf is the Director of the Clean Air Program at the Energy Policy Institute (EPIC) at the University of Chicago.

We discuss:

• Why PM2.5 (fine particulate matter) is so harmful—and so under-recognized
• How Christa went from studying other planets to helping reduce pollution here on Earth
• The story behind founding OpenAQ, the world’s largest open air quality database
• How publicly accessible data changed the political narrative in places like Beijing and Ulaanbaatar
• EPIC’s Air Quality Life Index (AQLI) and how it connects pollution to life expectancy
• Why countries like Gambia are seeing rapid progress from low-cost, high-impact initiatives
• How philanthropy and global investment are often misaligned in this area with where the need is greatest
• The surprising success of India’s clean air market experiment—and its potential to scale

We also touch on the relationship between air pollution and climate change, how policy can bridge that gap, and why building local trust and capacity is key to long-term success.

This is a wide-ranging, hopeful, and data-driven conversation about one of the most overlooked issues in global health and climate.

🔗 Learn more about EPIC’s Clean Air Program: 

https://epic.uchicago.edu/area-of-focus/clean-air-program/

https://aqfund.energyandpolicy.org

For questions, comments or suggestions, you can contact me at [email protected]

Send us a text

In this episode, I speak with Dr. Ishan Nath, assistant professor at the Harvard Kennedy School, about his research on climate change, agriculture, and trade. His forthcoming paper in the Journal of Political Economy explores how warming could actually increase the share of workers in agriculture in many low-income countries, especially those with limited access to trade.

We discuss why trade barriers matter for climate adaptation, what makes agricultural labor patterns persistent, and how economic development intersects with environmental vulnerability.

Dr. Nath's site : https://www.ishannath.com/

His paper "Climate Change, the Food Problem, and the Challenge of Adaptation through Sectoral Reallocation" can be downloaded here: 

What We Cover in This Episode:

• The research question: Can farms move toward more temperate regions as the world warms? And what does that mean for global adaptation?
• Threshold temperatures: Why extreme heat—above 29°C (~84°F)—is especially damaging for agricultural productivity.
• Why the Global South is most at risk: We explore how countries that are already hot, poor, and heavily dependent on agriculture are hit hardest by climate change.
• The “food problem”: A key concept explaining why low-income countries remain stuck with large agricultural labor forces despite low productivity.
• Trade limitations: Ishan shares findings on why poor countries import very little food—and why that severely limits their ability to adapt.
• Counterfactual simulations: What happens when trade barriers like tariffs and regulatory frictions are reduced? The results show substantial reductions in climate-related economic losses.
• Why trade matters for adaptation: The conversation highlights how better trade integration could significantly soften the blow of climate change in vulnerable regions.
• Heterogeneous climate impacts: From Northern Europe to India, we discuss how temperature changes affect countries differently, and why wealth and infrastructure matter.
• Policy implications: Beyond emissions reductions, what role should global trade policy play in climate adaptation strategies?

💡 Key Takeaway:

Climate change isn't just an environmental issue—it’s a structural development challenge. If global trade systems remain as they are, many low-income countries may be pushed further into vulnerable, low-productivity sectors like agriculture. But if trade barriers are eased, international markets could play a powerful role in helping these countries adapt.

For questions, comments or suggestions, you can contact me at [email protected]

Send us a text

In this episode, I sit down with Dr. Koen Deconinck, economist and policy analyst at the OECD, to explore a deeply technical but increasingly important piece of the climate puzzle: how we measure greenhouse gas emissions in the agricultural sector.

Direct and indirect emissions in Agriculture are responsible for up to 30% of global man-made emissions, yet it's often left out of the climate conversation. Why? Because measuring these emissions accurately is really hard. Dr. Deconinck walks us through the fascinating and complex world of emissions data—from cows burping methane to fertilizer releasing nitrous oxide—and why product-level averages are not sufficient.

We dive into:

• Why farm-level variation in emissions matters way more than most people realize
• The challenges (and importance) of moving beyond averages to granular, farm-specific data
• The rapid rise of tools, databases, and labeling schemes—and the chaos that comes with them
• How programs like Origin Green in Ireland succeeded in gathering farm-level data at scale
• The two biggest gaps: harmonizing reporting standards and improving farm-level tools
• Why getting the measurement right is critical—not just for better policies, but also for businesses and consumers who want to make more sustainable choices

Koen also shares behind-the-scenes insights from his work on the OECD report “Measuring Carbon Footprints of Agri-Food Products: Eight Building Blocks” and why the pace of development in this field has become—yes—fast and furious.

🔗 Link to the report:
Measuring Carbon Footprints of Agri-Food Products

🔬 Also cited:
Poore & Nemecek (2018) – Reducing food’s environmental impacts through producers and consumers, Science, DOI: 10.1126/science.aaq0216

If you’re interested in climate policy, sustainable food systems, or just curious about what it really means when we talk about a product’s "carbon footprint"—this one’s for you.

Thanks for listening,
— Arvid

#agriculture #emissions #carbonfootprint #sustainability #foodsystems #OECD #KoenDeconinck #farmdata #reportingstandards #climatepolicy #greenwashing #OriginGreen #methane #FastAndFurious #climateeconomics

For questions, comments or suggestions, you can contact me at [email protected]