Ieconomics is the subject of much criticism regarding the way in which it has grasped environmental issues. Some of them are unjustified, but above all they do not identify the main weakness of environmental economics.
Some of these criticisms are certainly well deserved. By claiming to apply the cost-benefit calculation to determine the optimal level of global warming, some prestigious economists have discredited the discipline. The rudimentary models used, unable to account for the complexity of the underlying physical phenomena, the existence of tipping points or planetary boundaries, are the classic example of bad science.
The main thing already said
Economists have often gotten lost in theological discussions about discount rates, when the crux that invalidates the cost-benefit calculation for determining mitigation efforts is that of radical uncertainties about the consequences of inaction. However, this has been recognized by the best specialists in the field. Thus Christian Gollier readily acknowledges that it is not up to economists, but to politicians, to prescribe what the level of global warming should be.
Some also deplore the quantitative weakness of publications in economics dealing with climate change. But this criticism is largely undeserved. Indeed, the main results in environmental economics are old, solid, and still relevant.
It was economists who highlighted market failures in terms of collective goods (the climate, for example) and common goods (the “carbon budget”, for example). They also helped to determine the most efficient instruments (taxes and emission quota markets) to reduce externalities. It is not very honest to attack them on the grounds that they have written little on the subject… because the essentials have already been said.
Economists are also criticized for focusing on the price of carbon. But, again, it’s not very fair play. The carbon tax has certainly met with strong social opposition in France, but this should not lead to throwing the baby out with the bathwater. Regulatory measures are only more socially accepted… because they are not applied! Let us try to ban, for example, recreational motor sports, and we will see if this kind of measure is not unpopular…
You have 58% of this article left to read. The following is for subscribers only.