Economics, Finance, & Markets
The market economy can play a valuable role in shifting to a green future, but free markets alone can simply perpetuate past pollution and depletion. The Bezos Earth Fund is working to accelerate changes in goods and financial markets to create a virtuous cycle of investment, prosperity, jobs, innovation, emission reductions, and ecosystem protection.
Most environmental assets remain outside today’s financial and goods markets, and thus are undervalued and depleted. And most economic models don’t incorporate environmental issues adequately and fail to capture the full benefits of moving towards a cleaner greener economy. Done right, the payoffs of these changes can far outweigh the costs.
In some cases, new markets are required. Carbon emissions, biodiversity and ecosystem services are examples. Getting the rules right for such markets has proven difficult, and progress must be accelerated. So too, important “green” new products may not enter the marketplace quickly enough to drive the change we need and may need support as tastes are created and costs are reduced. Plant based proteins, drought resistant seeds, electrification of heavy transport, remote monitoring systems are examples.
Most economic and financial models underestimate the positive effects of ambitious climate and nature action. But this is changing.
Evidence suggests that smart policies will not only stop the adverse effects of pollution and climate change but can also spur new technology, increase resource efficiency, lower uncertainty, and promote dynamic entrepreneurship and new markets. Our interlocking crises requires better analytics that capture such effects and take account of the costs of natural resource degradation, while highlighting potential trade-offs.
Along with our partners, we will work to ensure the markets help, not thwart, the transition to reduce emissions and protect nature.