The Economic Role of Alarmism and Overreaction

Food for thought:

Lots of innovations and improvements are not economically viable in the short term, but would make our world a better place over the long term if implemented today. If people always recognized that their "better" choices today come at a cost which often outweighs the present value of the improvement, there would be less incentive to develop the "better" technologies in the first place. For example, people are freaking out about global warming and spending way more money than makes sense on environmentally friendly technologies. From a present value perspective, these choices seem unreasonable, and perhaps they are. But the presence of these unreasonable, overreaction-prone people in the marketplace means that change can be funded even when it, in some idealized sense, "shouldn't" be economically profitable. So if you would prefer to see the kinds of end-states that alarmists are clamoring about, but don't think that the costs of making them happen would be worth bearing, be sure to say a word of thanks for those irrational alarmists who'll gladly pay on your behalf!