As gleaned from “Berck and Helfand”, Economics is the study of the allocation of scarce resources. When there is not enough of something – housing, food, energy, forest – so that anyone can have as much as desired, some processes must be developed for determining who gets how much of the goods. Economics focuses on market as a means of allocating these goods.

Green Economics ensures that in the process of allocating scarce resources, the quality of lives of citizens are improved without depleting natural resources for future generations.

If I were to create a green economy, it would be one where:

1.) Carbon pricing is implemented: Pure natural resources sure as clean air, and clean drinking water are scarce resources. If individuals and organizations that pollute these natural resources are not made to pay for the cost,they do not get a market signal to reduce damaging behavior. Traditional economics have shown us that price affects the human behavior. Putting a price on carbon pollution would help individuals and organizations make positive choices when it comes to reducing carbon footprint. A wonderful example of how the prices would help change human behavior positively towards the environment was cited in “Berck and Helfand, Chapter 1”. It says “Burning gasoline emits greenhouse gases, including carbon dioxide and nitrous oxide. If gasoline becomes more expensive, the air pollution, climate change and land use effect associated with gasoline use will decrease. This is because, people would start looking for alternatives like using public transport, carpooling, or relocating closer to their schools and work place.”

2.) Large Investments on Resource Efficient Technologies: such as green buildings and Fuel efficient cars.

3.) Negative Externalities are dealt with active Environmental Policies: In the article “Building a Green Economy”, negative exterlinaties is said to be the costs that economic actors impose on others without paying for their actions. One way to deal with negative externalities is to make rules that prohibit or at least limit behavior that imposes high cost on others. Carbon pricing as seen earlier would help limit behavior, however complete prohibition of some activities/processes are needed in a green economy. For example, prohibiting cars that do not meet certain emission standard from the road, prohibiting the release of certain chemicals into water ways by industries.

To ensure the sustainability of a green economy, an environmental enforcement agency would be created to ensure that individuals and organization adheres to all environmental policies put in place by policy makers. Policies would also be reviewed continually to ensure the best for the present and future generations.