Adaptation to Global Warming as an Optimal Transition Process to A Greenhouse World

This article develops the economics of adaptation to global warming as an optimal transition process to future climates. Three policy approaches that encompass the existing theories and policy options are initially outlined: measures based on individuals' social responsibility, government regulations, and carbon pricing. Evidence suggests that each of these options has little chance of being agreed upon and implemented at a global level. The economics of adaptation begins with climate signals which force individuals to adapt. Private adaptations are simultaneously tapped into for carbon dioxide removal and abatement. With increasingly severe damage over time, public sectors will be compelled to work in partnership with individuals and communities. Responding to amplifying climate signals, adaptation strategies evolve in such a way as to accelerate carbon dioxide reductions through low-carbon energy sources and technological solutions. Adaptations in a centuries-long timescale would effectively fend off dangerous global warming, but in a manner that is unbearably slow for the world's communities. The optimality of the transition process is based on micro efficiency, coordination, and the public goods nature and unique characteristics of specific adaptation strategies.