temperature. The rise in temperature is leading to the melting of polar ice
caps, a slow increase in sea level, a creeping expansion of the world’s
great deserts, reductions in agricultural productivity, and significant
changes in global weather patterns—including a greater frequency of
extreme events such as floods, droughts, and hurricanes. Global climate
change presents a challenge for the design of better economic policy,
aimed at reducing greenhouse-gas emissions without unduly slowing the
growth of material living standards. Climate change also presents a long-
term challenge as to how we will adapt to the changes that are already
happening.
Accelerating Technological Change
Over the past half century, the digitization of informawwwtion has
created revolutionary changes in technology, from the evolution of hand-
held computers with enormous capabilities to the development of
artificial intelligence whereby machines are able to learn.
Nanotechnology and 3D printing are just two examples that are likely to
lead to products and services we can barely imagine today. Such
technological change is an important driver of our long-run prosperity—
but it also creates enormous disruptions in product markets and labour
markets. Some businesses will find it difficult to compete against rivals
with more advanced technology and will be forced to adapt or go out of
business. Some workers may find their jobs replaced by machines and
will be forced to retrain to find acceptable employment, perhaps in
another city or province. Such “disruptive technologies” also create