Irene Peters, Frank Ackerman, and Stephen Bernow explain in this paper why most economic policy assessment models are biased against those policy changes required to meaningfully address the challenges of climate change. Still confident in the importance of economic analysis, they call economists to wake up from the dream of market optimality and adopt more realistic assumptions as regard the treatment of technology, technological path dependence, and positive feedback mechanisms.
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Peters, Irene, Frank Ackerman, and Stephen Bernow. 1998. Economic theory and climate change policy. Boston: Tellus Institute.