Posted by Jonathan Adler:
Nordhaus on the "Stern Review":
http://volokh.com/archives/archive_2006_11_19-2006_11_25.shtml#1164219108
Publication of the [1]Stern Review on the Economics of Climate Change
appears to have had a significant impact on the climate policy debate.
Yet there has been significant criticism of some of the report's
assumptions and conclusions (as I noted [2]here).
Among the more recent critiques is [3]this assessment by Yale's
William Nordhaus (link via [4]Prometheus). Nordaus notes that the
Stern Review reached significantly different conclusions from most
prior economic assessments, particularly with regard to the optimal
rate and timing of emission reductions. Nordhaus concludes in his
"summary verdict" of the Review:
The radical revision of the economics of climate change proposed by
the Review does not arise from any new economics, science, or
modeling. Rather, it depends decisively on the assumption of a
near-zero social discount rate. The Review�s unambiguous
conclusions about the need for extreme immediate action will not
survive the substitution of discounting assumptions that are
consistent with today�s market place. So the central questions
about global-warming policy � how much, how fast, and how costly �
remain open. The Review informs but does not answer these
fundamental questions.
For a more sympathetic assessment of the Stern Review, see [5]this CT
post.
References
1.
http://www.hm-treasury.gov.uk/independent_reviews/stern_review_economics_climate_change/sternreview_index.cfm
2. http://www.volokh.com/posts/1162496608.shtml
3. http://www.econ.yale.edu/~nordhaus/homepage/SternReviewD2.pdf
4.
http://sciencepolicy.colorado.edu/prometheus/archives/climate_change/000996william_nordhaus_on_.html
5. http://crookedtimber.org/2006/11/21/reviewing-the-stern-review-2/
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