Climate changeClimate change and global warming are the most significant negative externalitiesNegative externalities affecting global production. Atmospheric concentrations of carbon dioxide and other greenhouse gas emissions have increased remarkably since preindustrial levels. The global increase in carbon dioxide is due to increasing fossil fuel use and land-use changes. This chapter discusses climate change as a negative externality of global production, theSocial cost of war emissions social cost of war emissionsWar emissions, and the monetary price of carbon emissions. The increase in global temperature and carbon emissions is attributed to the high demand for energy for residential, industrial, and commercial purposes. An increase in global energy demandGlobal energy demand drives global warming and results in changes in climate over time. Since the Industrial Revolution, human activities have had atmospheric concentrations of greenhouse gases on the Earth’s surface. The climate has experienced long-term changes in temperature, weather, sea-level rise, and precipitation. This introductory chapter addresses public goods, market failure, externalities of war, and carbon emissions, and how imposing a price on carbon can reduce global production externalitiesGlobal production externalities. Human activities had already warmed the planet by about 1°C above pre-industrial levels, and achieving the Paris Agreement goal of limiting global warming to 1.5°C is now increasingly challenging. Excessive carbon emissions need to be tracked and controlled to avoid great risks to humanity and the economy. In this context, this chapter highlights carbon pricing as an instrument to control carbon emissions.