(a) energy is not scarce; the historically most efficient sources (oil, coal, etc.) are;
(b) a well-functioning price system will shift energy consumption to
(cleaner) alternative energy sources as prices for historical extracted
sources of energy rise;
(c) the initial high price of alternative energy will temporarily
slow growth, but competition and technological progress will eventually
push prices below the historical trend and even asymptotically approach
zero, increasing average rates of growth;
(d) environmental quality is a global public good, but;
(e) this is most likely to be secured as a consequence of growth –
as a consequence of the technological innovation that both creates and
is created by growth – together with the rising scarcity and prices of
the most environmentally degrading energy sources.
(f) there are no meaningful limits to growth from either the
scarcity of energy, or from negative environmental externalities from
economic production, since in the medium run, those externalities are
Here is the link. I’m willing to buy that theorem with reasonably high probability. What worries me is that first sentence: "energy is not scarce" — it also could have been written "destructive energy is not scarce." A world where we solve our energy and environmental problems is also a world where small groups or lone individuals have great power to destroy.
In Cleveland I posed a variant of the following question: let’s say that you can blow up the world if a) you can exceed 1550 on your two main SATs, b) you are willing to spend $50,000, and c) you sincerely wish for world destruction for one month straight.
How long would the world last?
We may someday envy the problems we have now.