How can we counter climate change effectively, sustainably and in a socially acceptable way? During a public lecture, Nobel Prize winner for economics Prof. Jean Tirole shared answers from an economic perspective. His message: there are solutions – and we need to start implementing them. More than 300 visitors attended the event on the Kühne Logistics University campus.
The event was held in advance of this year's KLU graduation ceremony, which was held on September 14. "Your degree comes with responsibility," Prof. Tirole directly addressed attending graduates in at the beginning of the event. "Help us to bring back rationality into the discourse – you are key to solving our biggest challenges, such as the environmental crisis. So be brave and be bold”, he said.
Climate change is a ticking time bomb, he explained at the start of his public lecture. A few years of inaction are hardly noticeable at first - "but 30 years are. There is now an absolute urgency as there has unfortunately been much delay in decarbonization and in green research and development," he stated. On the positive side, he said, there has been progress in certain technologies, such as wind and solar power, and the need for action is now accepted by the majority of citizens and businesses.
Global carbon price the most effective tool
In Tirole's view, the introduction of a price on carbon is absolutely vital. „We need something simple that is helping us to guide our decisions”, he explains, “A carbon price will create the right incentives for decarbonization and encourage green research and development” A simple example: Should a costumer buy local tomatoes from Hamburg, possibly grown in a green house, or those imported from Spain, transported over a long distance? Which decision is the “green” one? “I don’t have a clue myself”, Tirole says. “But if we had a carbon price, it would already be embodied in the price of the tomatoes. The decision would then be very simple.” Of course, compensation would be just as important as the price, since rising costs particularly affect those people with less money.
Social responsibility is key
Prof. Tirole also stressed the importance of social responsibility of each and everyone. “We have relied on the market and on the government correcting the market’s failures for too long. We need social responsibility to correct their twin failure in environmental matters”, he said. In these difficult times, society needs to put pressure on governments to do the right thing regarding climate change. “It’s not enough talking only to experts. If people are not educated and don’t have access to expertise, then we can’t expect economy and society to function well”, he said.
Solutions from a holistic and multi-disciplinary perspective
The event was organized by the KLU Research Center for Sustainable Logistics & Supply Chains (CSLS) and the Kühne Center for Sustainable Trade and Logistics at the University of Zurich. “We’re rapidly moving into a time of extraordinary social and environmental change, and to address challenges such as climate change in an effective way, we need to look for solutions from a holistic and multi-disciplinary perspective,” said Johannes Meuer, Associate Professor for Sustainability Strategy and Operations and co-director of the CSLS. “At KLU’s CSLS, we’ve adopted such a perspective, working closely with industry and civil society in translational research projects to identify effective solutions. Jean Tirole’s work on the political economy of climate change also adopts such a perspective, outlining the problems and challenges of our current political and economic systems, but also offering solutions that draw on economic theory. As such, we are honored and thrilled to have co-organized this event together with our colleagues at the Kühne Center for Sustainable Trade and Logistics.”