More than two years have passed since Nick Stern’s report on the economics of climate change was published, yet the question of how to weigh the costs against the benefits of acting on climate change – and whether such an approach in even ethical – is still being hotly debated.
Stern’s adherents, on the one hand, support the stance of the former World Bank economist who argues that taking strong, early action on climate change outweighs the costs of doing nothing, or of delaying action. On the other hand, some of Stern’s detractors – most notably ‘skeptical environmentalist’ Bjorn Lomborg – argue that although climate change is happening, major reductions in carbon emissions are simply not worth the money. (Others argues that Stern was right for the wrong reasons, but I won’t go into that here).
The latest to weigh on the issue is Frank Ackerman, a research economist at Tufts University in Massachusetts, whose new book Can We Afford the Future?: the Economics of a Warming World is reviewed by Yoram Bauman over on Nature Reports Climate Change. Bauman teaches at the University of Washington, but he is perhaps better known for adding levity to such impenetrable topics as climate economics with his stand-up comedy routines.
Bauman picks out some highlights of Ackerman’s analysis, namely his policy prescription for massive government-funded clean-energy R&D and his coverage of Harvard economist Martin Weitzman’s work on improbable, but not impossible, catastrophic climate change.
Ultimately though Bauman concludes that Ackerman is the perfect odd couple match for Lomborg.
His gripe is that the average reader would find it near impossible to untangle the parts that accurately portray mainstream economics from those are the author’s heterodoxy. Bauman writes:
Ackerman sounds convincing when he says that “conventional economic theory reflexively shuns intervention in private markets” and is in thrall to the “fairy tale” of Adam Smith’s invisible hand. But a very different picture comes from reading the “Economists’ Statement on Climate Change”, a call for action signed by six Nobel laureates way back in 1997, or from learning that Harvard’s Gregory Mankiw, an economist with impeccable conservative credentials, has started a “Pigou Club” on Facebook to drum up support for carbon taxes.
In the end, the best reason to purchase this book is to provide ‘fair and balanced’ companionship to Lomborg’s Cool It. The two of them together come off like a high school debate contest: full of facts, most of them true, but in the end too biased to provide much enlightenment.
At least I’ll know where to point the next Lomborg-enthusiast I meet…