I see! I was thinking about something else and didn’t notice the difference.

If the goal is to burn fossil fuel with less pollution, then you need to track who’s doing the pollution. Once you know who that is, you can tax them or give them permits.

But if the goal is to reduce fossil fuel burning and encourage alternatives, then it’s enough to tax *fossil fuel* sources and let them pass the added costs on until those costs reach final customers. Customers might still pollute when they burn, but it will cost them more and alternatives will be relatively cheaper than they would otherwise. Fossil fuels become more expensive for all uses and the uses do not have to be tracked — the market passes those expenses wherever the fuel goes.

When the goal is to burn with less pollution, then you must measure the pollution. Polluters win just as much by finding ways to hide their pollution as they do by actually reducing it. Lots of information to track, lots of chances for corruption.

The more that we can get alternative energy sources to replace fossil fuels, the better off we are when the fossil fuels get scarce enough to drive up the price. It’s like when you’re driving, you want to start looking for a gas station before your engine starts sputtering because you’re running out of gas. The time that free markets signal that supply is down and cannot go up, may not be the best time to start building a whole new infrastructure. But this is a different problem from fossil fuel pollution.

If we just focus on getting alternative energy, that doesn’t stop fossil fuels from polluting while they’re still getting burned. It doesn’t even stop the alternate energy from polluting.

A different problem. Taxing fossil fuels is easy. Taxing them when they pollute according to how much they pollute is much harder.

To do a carbon tax you have to track the carbon fuel sources, and tax them. And you have to figure out what to do with the money. Apart from that, the market could take care of itself.

You say they’re practically the same thing. Is it that the advantage of regulating carbon is large enough that the details don’t matter? Or have I missed the point?

YB: Once you track the carbon fuel sources sufficiently to tax them, you could also just require sources to have a permit… and that’s cap-and-trade.

“Price: $6.15
Also available from other suppliers without the Amazon “free shipping”
5 new from $1.99

Curious how Amazon’s price with free shipping is always those few pennies less than the best total price for buying from anyone else in the world who actually itemizes the cost plus shipping separately.

Care to comment, here or anywhere? Pointer welcome. I thought itemizing and disclosing costs was supposed to be an economic good thing providing more information so people could make better choices.

I do agree with many of the conclusions with respect to the curriculum and the content of the economics classes. The role of volunteering and philanthropy should be studied together with optimization theories and consumer behavior. Or at least a mention of it should be made somewhere in between the ‘invisible hand’ and the power of capitalism. I also agree that the selfless are happier than the selfish. It worked for me…

However, I also have to agree with Michael on the ambiguous definition of ‘generosity’ or its absence thereof. Also, lobbying and public policy causes are not usually the most typical recipients of charitable donations. They are more so for people with special interests. Even my untrained eye could not ignore several other drawbacks of the paper.

1. Omitted Variables: individual characteristics were mentioned but only in the personality aspect while neither parent’s income nor monthly expenses were taken into consideration. Is it possible that economics majors tend to be less wealthy on average? Maybe women have higher monthly expense than man? Maybe international students rely on scholarships and private loans to attend college and they don’t really have the option to add a couple of extra dollars to their education bill.

2. The paper is unconvincing that taking economics class causes non-economics majors to decrease their giving. A simple reason might be that they have already donated in a previous semester. Especially given the hard nature of economics and the fact that most non-economics majors are intimidated by the core requirement of microeconomics, they are very likely to procrastinate and take it in their 3rd or 4th semester after already donating in the first two semesters

3. I do not agree with the statement that older students donate less because they are less likely to realize the benefit of their donation. The statement simply contradicts the very meaning of the word ‘donation.’ Donations are usually given without return considerations, let alone expecting personal realization of the benefits of your donation. Donation is not like the Social Security or an investment fund where people expect returns. Donation is for others to make use of the benefits of the gift.

In general, the paper raises a good question but seems to me that there is a lot more work to be done in order to make it a convincing piece that can be cited even if only for fun amongst economists.