The Economics of Global Warming:

Serious international discussion on global warming did not start until the singing of the Framework Convention on Climate Change at the Earth Summit in Rio de Janeiro in 1992. It was not, however, until five years later that the first United Nations conference to enact a binding international agreement to control the emissions of greenhouse gases was held in Kyoto, Japan—the Kyoto Protocol. This environmental conference clearly indicated that climate change or in this particular instance global warming (see Box 1, next page) is a very serious problem and the world community has to take concrete steps to reduce the emissions of greenhouse gases (GHGs). The final agreement reached under the Kyoto Protocol decreed an average of 5.2 percent cut in greenhouse gas emissions from 1990 levels by the year 2012. Furthermore, the emissions cut will be forthcoming entirely from the developed nations. The main message of the Kyoto Protocol agreement has been that doing nothing about global warming is not an option if the present generation of humanity is to avoid passing-on a world to future generations that is going to be hostile and incompatible to pursuing a ̳normal‘ and productive life as we know it today.