I posted this earlier today in the tech lemmy instance, but, they have no sense of humor and deleted it. I'm trying here.
this post was submitted on 31 Jul 2023
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My favorite proposed implementation is blockchain based - Bitcoin Hivemind. It's a general purpose prediction market but I'd want to use it for pollution in particular.
Basically you can bet on whatever you want. Whatever it is, there's someone betting against you. Most people want insurance against bad things - so they'd bet on rising sea levels, hurricanes, etc in their region. The insurers (those betting the bad thing won't happen) now have an incentive to hedge their risks and bet on what causes those bad things (global CO2 levels).
So ultimately, buying insurance against your house going underwater would create an incentives for other users to do things to reduce pollution. How well this can actually work would depend on total transaction costs being very low, because there'd be several prediction markets between Caribbean hurricane insurance and the pollution prediction market for some factory in Ohio.
I hope that polluters rationally decide to cooperate peacefully, bet against pollution themselves, and then voluntarily reduce it. But if they don't, then someone else can reduce their emissions and get paid anonymously. It's the same mechanism as Jim Bell's assassination politics, but I think killing the physical sources of pollution would be more productive than killing people.
Ah, I see. That is quite clever. And I like the idea of implementing it in non-centralised market. This could be an actual use case for those, instead of all those pictures of cats and monkeys.
This would have to scale quite significantly for those betting against climate change to be able to affect it. Like you say, corporations could cooperate and also gain some goodwill. And venture capitalists, or just any investor, could chip in.
I really like the idea of creating direct economic incentives for positive development, at the same time as you insure those that are harmed if it doesn't go so well. And this would also be global and have direct effects, and not sensitive to populist politicians and temporary government investments like climate politics tend to be today.
Edit: spelling