There is a broadly shared sense among us and expressed by several authors featured in this volume, that the pandemic is both a deeply disturbing event but also an opportunity for learning and a call for action. The articles recognise the tragedy of well over half a million deaths worldwide, the millions more suffering from this illness, and the very many more who have been thrown into poverty, desperation and food insecurity. They document how entire communities have suddenly lost their primary sources of income, and how border closures have minimized migration, leading to a rapid increase in the number of people who must rely on nature for their survival. At the same time, the global shutdown has provided a real-life natural experiment that can be used by researchers to understand environmental-economic relations in a manner that would never normally be possible. For example, issues such as the links between economic production, air pollution and CO2 emissions, or the extent to which economic shocks lead to changes in behaviour and attitudes towards environmental policies, can now be assessed in this unfortunate but truly unique global lab.
Several articles in this Special Issue study the linkages between the trade in wild animals, the emergence of zoonotic diseases, and how the macro-economic impacts of the pandemic have forced many people in precarious economic conditions to rely more heavily on wild meats for sustenance. The fact that close interaction between humans and wildlife are the very source of the global crisis underscores the importance of future research to develop a better understanding of the complex links between livelihood strategies, resource dependence, and zoonotic diseases. More rapid progress can be expected on this front if environmental and resource economists work across disciplines with conservation scientists and epidemiologists. That the impacts of the epidemic on environmental quality and natural resource management may be very different for low and middle income countries than for richer ones should not be surprising. However, it is a reminder that both research and policy making need to pay greater attention to distributional impacts across the globe.
Many of the papers in the special issue draw parallels between the pandemic and the 2008–2009 financial crisis. However, the scope and depth of impacts caused by the pandemic also makes it a far more momentous event. With massive unemployment, growing government debt, increasing numbers of firm defaults and breakdowns in international cooperation, disruption of internal and international trade networks, and disruption to some food networks, the pandemic shares many characteristics not only with past economic crises but also with armed conflicts, political shocks and natural disasters. It is proving to be a test of political doctrines and of the ability of nations to coordinate and cooperate. This could turn out to be especially important for the economic stimuli packages that are intended to restart economies. To minimize a likely rebound effect, policies need to be much better coordinated. However, as some of the papers argue, coordination or cooperation remains difficult. We thus wonder whether a crisis such as this pandemic will make countries shift back further into protectionism and individualism, or whether world leaders can use this moment to focus on shared interests. This question also has important repercussions for the ability of countries to cooperate on issues such as climate change or international pollution spillovers. Will this pandemic help spur a recognition that global crises require global solutions?
The fact that most countries and international organizations have demonstrated an ability to mobilize and a willingness to put in place drastic measures to curb the spread of the virus, accompanied by extraordinary levels of economic support to affected individuals, must leave us with some optimism. We concur with many authors featured herein that the need for continued economic stimulus presents an opportunity to usher in the green transition necessary to address the longer term environmental challenges, such as climate change, that threaten the viability of all national economies and people globally. The scale of current and foreseeable fiscal interventions is such that if fiscal policies were strategically deployed to incentivize more efficient greener economic activities, it could mark a significant shift towards addressing the threats posed by climate change, ocean/fisheries collapse, as well as habitat and species losses.
Many parallels have been drawn between this pandemic and climate change. Both involve externalities, both induce substantial costs to society, and both require us to rethink our approach to trade, growth and welfare. There are, however, important differences between the two. No drastic measures have been taken to combat rising temperatures. Instead, despite continued warnings, actions remain are generally delayed. Hence, as economists we are keen to understand the differences in the incentive structure between these two problems and to learn how the climate change debate can be reframed in order better communicate the risks and prompt action.
The number of calls across academia and society for rescue packages to be tied to a green transition have been astonishing and these are reflected within this Special Issue. However, the ongoing economic recession following the health epidemic has changed the scene for research on economic policy instruments. In particular, if carbon taxes are increasingly seen by the public at large as simply a means to decrease wage income and put work opportunities at risk, it will become even more important than before to explore and advance our knowledge of the actual implications of carbon pricing on labour markets. In order to obtain stronger social support of carbon pricing and policies for environmental transition, a stronger social contract with a higher degree of citizen involvement is both necessary for the acceptance of such changes and essential for strengthening the social norms required for decentralized internalization of externalities. Again, the question of international cooperation looms heavily over whether or not this crisis will create, or reduce, incentives for international carbon policy. Related questions that arise are: Do the green deal measures have to be redesigned? How do we avoid an economic recovery that simply leads us back to previous emissions trajectory? How should the Market Stability Reserve be designed, or redesigned, in order to deal with similar problems in the future?
For environmental and resource economics as a discipline, such uncertain times can be both unsettling and tremendously stimulating. In the pages that follow, a rich collection of research ideas and agenda waits to be discovered. It is our hope that as a reader, you will find interesting early results, be motivated to develop new research questions, and take note of the policy challenges and opportunities that lie ahead.
The Guest Editors
Environmental and Resource Economics
The Official Journal of the European Association of Environmental and Resource Economists