This past winter, I went with my wife and daughter to the Brooklyn Botanic Garden, where a blooming Japanese apricot tree had been creating headlines. With the temperature in the low 70s, the garden was thronged with people in T-shirts and shorts. ­After looking in astonishment at the pink blossoms that had come out at least two months early, I did a quick cost-benefit analysis of this presumed product of climate change. On the plus side, thousands of New Yorkers had enjoyed a rare winter treat; the entrance fees they paid to the garden had boosted the city’s coffers; and the media industry, a major New York employer, had been supplied with a news story. What about the costs? The only one I could think of was that a few people might have decided they no longer needed a winter vacation, which would hurt the airlines and the Florida tourism industry.

Now that even the Bush administration has accepted the reality of global warming, it may seem gauche to bring up something as base as money. But the fact is that many industries will benefit from rising temperatures. Consider American farming: Though global warming imperils the water supply of California’s Central Valley and rising sea levels threaten Florida’s sugar production, grain producers in the Dakotas and cabbage growers in the Northeast would welcome shorter winters and longer growing seasons. Or take tourism. While some parts of the Mediterranean could eventually become too hot for sunbathing, and Saint-Tropez would suffer as vacationers deserted it for fear of frying, depressed coastal resorts in northwestern Europe would enjoy a resurgence. (Summers in Scarborough, anybody?)

Adding up the economic pluses and minuses of climate change is a vast and quite possibly futile endeavor, but economists have never been ones to let practicality deter them. We do know that tackling global warming will be costly. Power companies will have to invest in cleaner plants, consumers will have to insulate their homes, and governments will have to invest in renewable energy. Al Gore says this spending would be worthwhile, but Danish economist Bjørn Lomborg has pointed out that it could divert resources from other worthy causes such as the treatment and prevention of malaria, which kills more than a million people every year.

The standard way economists evaluate an investment is by placing a dollar value on its costs and benefits. Most studies show that the costs of rising temperatures will probably be relatively modest early on. “Countries in the polar region are likely to receive large benefits from warming, countries in the mid-latitudes will at first benefit and begin to be harmed only if temperatures rise [by more than 4.5°F],” writes Robert Mendelsohn, an economist at Yale. “Summing these regional impacts across the globe implies that warming benefits and damages will likely offset each other until warming passes [4.5°F], and even then [the cost] will be far smaller on net than originally thought.”

This conclusion has led Mendelsohn and other economists to advocate a gradualist approach. Governments would adopt only modest measures, like boosting research into fuel-efficient technologies. Decades into the future, when the world is much richer and technology is more advanced, humankind will be better placed to take more aggressive action. This is an arresting argument, but before you conclude that I am secretly working for a corporate-funded think tank that churns out skeptical studies on global warming, I should add that it depends, crucially, on a subtle ethical judgment that is rarely discussed: How much would you pay today to bequeath your great-great-grandchild $100? In personal and corporate finance, the ­basic rule on a long-term investment is that the promise of $500 in 10 years is worth a good deal less than $500 now. How much less? That depends on the interest rate—also known as the discount rate—that we use to convert future dollars into today’s money. Consider, for the sake of argument, an emission standard for coal-fired power plants that will reduce global warming by enough to generate $100 million of economic benefits in 2107. At a discount rate of 5 percent, the new standard is worth adopting only if the cost to power producers of meeting it is less than $750,000.

Expressed another way, this arithmetic implies that you should be willing to allot just 75 cents now to leave your great-great-grandchild $100. As economist Nicholas Stern noted in a recent report for the British government, this doesn’t seem right. Citing Frank Ramsay, a brilliant Cambridge mathematician of the early 20th century who developed some of the techniques that economists rely on in this area, Stern argued that using market interest rates to evaluate climate change policies is unfair to our descendants, because it undervalues their welfare relative to ours. Using a much lower rate—roughly 2 percent—Stern concluded that tackling climate change now would be much cheaper than allowing it to proceed unabated. In terms of morality, this seems persuasive, but economics is a contentious subject. William Nordhaus, another Yale economist, posed a different question: How much would we pay now to prevent a 0.01 percent decline in world output that starts in 2200 and persists indefinitely? The answer, using Stern’s methods, is about 15 percent of total world consumption, or about $7 trillion. “This seems completely absurd,” Nordhaus wrote.

Who is right? “The real difficulty here is that we are pushing economic analysis to its limits in an area where fundamental problems … remain unresolved,” John Quiggin, an economist at the University of Queensland, wrote in a recent article. “Economists can help to define the issues, but it is unlikely that economics can provide a final answer.”

It may be helpful to think of addressing climate change as an insurance policy rather than an investment. One of the greatest dangers of global warming is that it might start to feed on itself. A wholesale melting of the Greenland and western Antarctic ice caps could produce big changes in ocean and atmospheric currents, which in turn could lead to drastic rises in temperatures and sea levels. Scientists don’t know how likely it is that this will occur, but it’s a possibility that can’t be ruled out.

Economists have great difficulty dealing with risks that can’t easily be quantified, but regular people do it all the time—when they purchase life insurance, for instance. For a 40-year-old male nonsmoker, the annual premium for a $500,000 20-year term life insurance policy can run about $600. Since the typical 40-year-old male earns about $40,000 a year, it appears that he is willing to pay about 1.5 percent of his income for peace of mind.

Statistically speaking, it is unlikely that a 40-year-old man will get run over by a bus in a year’s time, but he takes out a policy just in case. Similarly, there may be only a small probability that unchecked growth in emissions would exacerbate global warming, but why take the risk? The Stern report said that acting now to stabilize carbon emissions at twice their preindustrial levels would cost about 1 percent of annual global output by 2050, which means it would be cheaper than life insurance. If Stern is right, taking immediate action on global warming isn’t just the ethical thing to do; it makes financial sense. But don’t expect the economists to agree on that anytime soon.