. Describe how policy makers should approach macroeconomic policy now that the scientific evidence clearly shows...

. Describe how policy makers should approach macroeconomic policy now that the scientific evidence clearly shows that future growth of output using current technologies will cause an environmental disaster that threatens the very survival of the human species. Use macroeconomic models to explain the problems and so outline possible solutions . how much we change the social and economic system that are currently altering the natural environment? Is more economic growth possible?

Expert Solution

According environmental Kuznet curve, as the economic growth increases the deterioration of environment take place upto a point. After the optimal point, the growth occurs is environment friendly.

Presently the emission of greenhouse gases is beyond the threshold of Kyoto protocol. If this trend prevails, then the Paris agreement Target of meeting temperature limitation would not be fulfilled.

Certain macro economic model can be used to tackle environmental issues like cap and trade model or pollution permit clubbed with business cycle trend. Use of rational expectations needs to be catered at every decision making point to resolve policy dilemma.

More economic growth can only be attained if nations abide by the philosophy of sustainable development. Whereby fungibility/substitution of scarce natural resources is actively worked upon.

Rahul Sunny answered 2 months ago

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