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Author ORCID Identifier

https://orcid.org/0000-0001-6627-8513

AccessType

Open Access Dissertation

Document Type

dissertation

Degree Name

Doctor of Philosophy (PhD)

Degree Program

Economics

Year Degree Awarded

2021

Month Degree Awarded

September

First Advisor

Robert Pollin

Subject Categories

Economics | Environmental Studies | Political Economy

Abstract

This dissertation contributes three essays exploring the political economy of global inaction on climate change.

Chapter 1 asks whether climate stabilization means the end of capitalism. Two influential perspectives within environmental political economy—the “degrowth” perspective from ecological economics and the “revolution” perspective from ecological Marxism—answer in the affirmative. If they are right, climate policy programs within capitalism, like the Green New Deal, are non-solutions. I evaluate their arguments, concluding that while environmental sustainability in general likely requires moving beyond capitalism, climate stabilization in particular does not. Given the urgency of the climate crisis, I conclude the chapter by outlining a theoretical framework for identifying and analyzing political economic obstacles to climate stabilization within capitalism.

Chapter 2 examines the economic underpinnings of the fossil fuel industry’s resistance to climate stabilization. I estimate the magnitude of wealth losses from stranded assets (i.e., the devaluation of fossil fuel reserves and capital goods) that fossil fuel firms will incur under 2 °C and 1.5 °C climate stabilization scenarios, and how these losses are distributed across the industry. I also compare profitability between fossil fuel and renewable energy firms for the period 2010-2019. Potential wealth losses amount to $13-15 trillion, impacting low-cost and high-cost producers alike. Three quarters fall on governments. Additionally, fossil fuel firms remain significantly more profitable than renewable energy firms. These results imply a strong economic incentive for industry to continue on the path of resistance. I conclude the chapter with a discussion on how to overcome the industry’s resistance.

Chapter 3, coauthored with Robert Pollin, evaluates one strategy for overcoming fossil fuel industry resistance: divestment. We consider whether the fossil fuel divestment movement has succeeded in inflicting financial damage on fossil fuel firms. We present descriptive data on the level of divested fossil fuel stocks and bonds and econometric analysis of the impact of divestment events on fossil fuel firms’ stock market prices. We find that divestment campaigns have not been successful in inflicting significant financial damage on fossil fuel firms, even though the movement has been successful in mobilizing activism and public opinion against them.

DOI

https://doi.org/10.7275/23620313

Creative Commons License

Creative Commons Attribution 4.0 License
This work is licensed under a Creative Commons Attribution 4.0 License.

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