Climate Change, Intergenerational Fairness, and the Promises and Pitfalls of Artificial Intelligence

Oliver P. Hauser ()
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Oliver P. Hauser: University of Exeter

Environmental & Resource Economics, 2025, vol. 88, issue 10, No 7, 2689-2706

Abstract: Abstract Among his many achievements, Daniel Kahneman will be remembered for his fundamental contribution to the economics of fairness with its many far-reaching applications. In this paper, I focus on intergenerational fairness and its importance in tackling climate change, a high-stakes example of an intergenerational dilemma. Drawing on recent technological advances, I explore how artificial intelligence (AI) can be applied to promoting fairness and cooperation in intergenerational dilemmas. An intergenerational dilemma is characterised by three key features: asymmetry in decision power and outcomes, no possibility for reciprocity between generations, and the global nature of the problem. Building on the literature of (contemporary) economic games, I discuss how AI has the potential to change “the rules of the game” by acting as a market participant or a market maker (i.e., social planner). I outline several directions for future research, where applying AI to the problem of intergenerational dilemmas shows promise, including intra- and intergenerational fairness, long-term preferences, and mechanism design. However, while AI holds the potential to help us tackle major societal issues like climate change, I conclude with a cautionary note that excessive use of AI today—even if well-intended to benefit future generations—could further accelerate the very problems, including climate change, that we set out to tackle.

Keywords: Intergenerational dilemma; Cooperation; Artificial intelligence (AI); Climate change; Mechanism design; C70; D02; D64; D70; D82; H41 (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/s10640-025-00986-y

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