Why has climate economics failed us?
Article

Why has climate economics failed us?

Economists could have helped in the fight against climate change. So far, they haven't.

Noah Smith, 2021

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  • Eye Opening
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According to financial journalist Noah Smith, economists have not yet heeded the call to action on climate change. His thought-provoking essay posits that relatively little research has gone into the field of climate economics, and that practitioners continue to hew to outdated formulas and models. Yet he points out that there is hope for this corner of the dismal science – more research, fewer silos, an appreciation of tail risks and less emphasis on carbon taxes would make economics a worthy contributor to the work on climate change.

Summary

Economics has paid scant attention to climate change.

Economists have fallen out of favor in US government, given their past failures to predict financial crises and solve gaping economic disparities. While economists see taxing carbon as a way to mitigate climate change, the Biden administration deems this a poor solution that does not consider the politics of climate change or a tax’s limited potential to reduce carbon consumption.

Technologists and activists are getting traction in discussions with leaders about policy responses, while economists are not. In this regard, the dismal science has been, well, dismal...

About the Author

Noah Smith is a Bloomberg Opinion columnist, and he blogs at Noahpinion. He is a former assistant professor of finance at Stony Brook University.


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