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Climate Economics

Climate Economics is Richard Tol's new book, currently available in draft for review here (I wasn't able to read it online - I had to download via the file menu).

It's clearly an excellent tome, written by a discerning author:

Climate research is rather controversial. Good introductions to the controversy are Mike Hulme’s book Why we disagree about climate change: Understanding controversy, inaction, and opportunity, Donna Laframboise’ book The delinquent teenager who was mistaken for the world’s top climate expert and Andrew W. Montford’s book The hockey stick illusion: Climategate and the corruption of science.


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Reader Comments (34)

Actually most climate research is boring data collection. It's the interpretation of that data that gets controversial!

Jan 21, 2013 at 6:13 PM | Unregistered CommenterEntropic Man

And Professor Tol ignores the last 15 (16?) years in his analysis of warming.
Oh, and also the (admittedly leaked) AR5 reporting of methane as lower than any scenario.

Jan 21, 2013 at 8:17 PM | Unregistered CommenterHeretic

I scanned it, it is a good book which I am going to read, but I know already that I do not like Richard's approval of carbon tax. Taxing a substance must have a meaningful purpose. Since CO2 is an innocuous - if not benign - substance, certainly with concentrations as in the atmosphere, it must not be taxed. It is like a tax on breathing.

Carbon tax could give rise to CCS, which is quite dangerous when CO2 is stored in large quantities. Too much of a good thing in a small area is often dangerous. This is true for CO2, N2, H2 etc.

From this post it will be clear I am very skeptical about the CO2-related mechanisms engineered in the climate models. From my profession I have some experience with complex software models and I know very well the trick to create mechanisms in models to get good-looking results. Such mechanisms have nothing to do with reality, unless they have been verified by experimental data. I have seen no experimental proof of the CO2 climate model mechanisms themselves.

Jan 21, 2013 at 9:39 PM | Unregistered CommenterAlbert Stienstra

On the contrary, CO2 is a wonderful thing to tax. It is essential, and that is the first requisite. Only tax things which people have to have, or in this case either emit or cause to be emitted.

Salt was taxed in the 18C in France for the same reason, the tax was the Gabelle, and we know how well that worked.

Jan 21, 2013 at 9:51 PM | Unregistered Commentermichel

Jan 21, 2013 at 9:51 PM | michel

I guess you have your /sarc button on...

Jan 21, 2013 at 10:05 PM | Unregistered CommenterAlbert Stienstra

I started to understand the origins of the complexity of the French administrative system the day I saw a map of the application of the salt tax in the 18th century.
(This is on topic, really)
The only similar map I’ve seen is of Northern Ireland education authorities.
If you apply a tax, or any other administrative action, on a basis of fantasy, you destroy the link between the state and reality, and between the citizen and the state. With the results that France saw in 1789 (and every year since, some would say) and which Northern Ireland is experiencing still.
At least the profiteers in 18th century France used their undeserved profits to create one of the world’s great civilisations. What did Lord Deben and Baroness Worthington ever do for us?

Jan 21, 2013 at 10:15 PM | Registered Commentergeoffchambers

@Albert Stienstra
If anything, the book argues for the application of tools such as cost-benefit analysis to the climate problem. If you can argue that CO2 is harmless (in expectation) and emission reduction is not, then the rational response would be not to regulate.

However, while one can configure a model such that CO2 is mostly innocent, even beneficial, equally and perhaps more plausible model configuration show that the impact of climate change is small but net negative.

Jan 21, 2013 at 10:51 PM | Unregistered CommenterRichard Tol

Richard - You mention cost benefit analysis - does your book cover the issue of lost opportunity from investing in poor return projects when there are better return opportunities available?

Jan 21, 2013 at 11:39 PM | Unregistered Commenternot banned yet

Strange book. On the first page of the first chapter he states, baldly, that there isn't a problem, ("Climate change has positive & negative impacts. Net effect is negative but small compared to economic growth") and then goes on to discuss what to do about this non-problem for thirteen chapters...

Jan 22, 2013 at 1:40 AM | Unregistered CommenterBitBucket

Change warmer is net positive, as a warmer world sustains more life and more diversity of life. Change cooler is net negative and a whole lot more negative than warming is positive.

As a consequence, the author can correctly, and blithely, say that climate change has a net negative. Neat.

Jan 22, 2013 at 3:24 AM | Unregistered Commenterkim

If we can trace a link from the gabelle to the guillotine, the 1789-94 destruction of a political elite, could we hope for one of history's darkly distorted echoes, a link from the carbon tax to the destruction of the posturing, powdered ninnies who presently claim to be the 'political elite'? Are we approaching nemesis time for the hubristic halfwits?

Jan 22, 2013 at 8:19 AM | Unregistered Commenterbill

It seems relevant to mention that on Friday RSA Insurance popped up with the claim that the UK loses £473M every time it snows. (Most outlets rounded up to £500M from what I can see.) Where does this fit into the mighty Stern report

By the way, when chasing up the original claim, I found that RSA also keep a "weather infographic" on the same page - here if I got the tags right. There are some wild claims at the bottom under Weather Trends. (Forgive if you discussed this at the time and I missed it, it seems to be dated 6 months ago.)

Jan 22, 2013 at 10:23 AM | Unregistered CommenterJit

I have indeed argued for 20 years, anti-domo, that climate change is a small problem with an easy solution. I have convinced few.

The fact that a problem is small does not imply, of course, that it does not need solving. I have an itch on my foot. That is decidedly unimportant, but I will scratch nonetheless.

Jan 22, 2013 at 11:15 AM | Unregistered CommenterRichard Tol

@ Richard Tol Jan 21, 2013 at 10:51 PM

"If you can argue that CO2 is harmless (in expectation) and emission reduction is not, then the rational response would be not to regulate."

Emission reduction is a broad term, there are emissions that may be good to tax and check with a toolbox on cost-benefit.

However, with CO2 tax - which on the whole we do not have yet - things will only get worse than they are already. Billions of dollars have already been squandered on useless so-called "renewable" technologies like wind- and solar energy. In countries like Ireland and Denmark, where wind energy contribution is of the order of 16%, a lot more than in most other countries, it has been shown that fossil fuel savings - and hence also CO2 savings - are small and likely to become negative with increasing contribution to the electricity grid.

I do not believe we have the tools to correctly judge cost and benefit of technology. Here it is not a paper exercise, like the greens calculating fuel savings from just the electricity produced by windmills. The influence of the intermittency on the grid must be taken into account and also the cost of the lifecycle of windmills, since they cannot replace a single conventional fossil fueled power plant on the grid.

We have some more knowledge on these issues now, but it is mostly obtained with model studies with some statistical data from practice. But we have no good idea how it will turn out in the future. Carbon tax will not help here and I fear that a lot more money will be squandered on wind and solar technologies. In the Netherlands the greens, which are currently sharing power in the government, want to deploy five times more windmills than they have now, with the only argument that the Dutch are behind the Germans. Likely they will end up with the same problems as Denmark and Germany, but without the solution Denmark can still use for the wind energy they cannot accommodate on their grid. I do not believe that carbon tax would help here, only when a lot more money has been thrown away.

I do not share Lomborg's green activism, but I do agree with his comment that with twenty years practice wind and solar energy technologies are shown to be expensive and unreliable, and that we had better invest in R&D for other technologies that are more likely to produce cheap energy. I firmly believe that carbon tax can only be instated when there is absolute certainty about cost and benefit in a stationary and well-known system, not when things are still so uncertain as they are now.

Jan 22, 2013 at 11:36 AM | Unregistered CommenterAlbert Stienstra

Richard Tol -
Why then are so many convinced that this "itch" requires surgery? [To stretch your metaphor to the breaking point.] Not a rhetorical question; you must have discussed this at length with your colleagues who are more alarmed. Is it just that their economic models show the net effect to be much larger than you believe? Is it the "fat tail" with improbable, huge disruption? I'm curious to know.

Jan 22, 2013 at 12:25 PM | Registered CommenterHaroldW

Anyone who can write, as Richard Tol does at the start of his draft section 1.4,

I argue above that climate change is a relatively small problem that can easily be solved. A casual observer of climate policy and the media would have a different impression.
has won my attention, if not yet quite my heart and mind.

He goes on to describe five 'things that stand in the way of a simple solution'. These are

Firstly, there is a demand for Sin and for a Final Reckoning. Although many Europeans are nominally secular, fewer are in practice. The story of climate change is often a religious one: emissions (sin) lead to climate change (eternal doom); we must reduce our emissions (atone [for?] our sins). This sentiment is particularly strong in Germanic cultures. It has led to an environmental movement (a priesthood) that thrives on climate alarmism that is devoid of a factual basis.

Secondly, climate policy is perfect politics. Climate change is a problem that spans centuries. Substantial emission reduction requires decades of global cooperation. A politicians can thus make grand promises about the saving the world while shifting the burden of actually doing something to her successor and blaming some foreigner for current inaction.

Thirdly, climate policy allows bureaucrats to create new bureaucracies. Climate policy has been a political priority for about two decades. Emissions have hardly budged. But a vast amount of civil servants and a larger amount of consultants and do-gooders have occupied themselves with creating a bureaucratic fiction that something is happening.

Fourthly, climate policy requires government intervention at the global scale. This antagonizes many, and feeds the fears of right-wing conspiracy theorists. This had [has?] led to a movement that attacks climate policy at every opportunity, and extend those attacks to the climate science that underpins that policy, and the scientists who conduct the research. Alarmists have retaliated in kind, and the result is polarization.

Fifthly, greenhouse gas emission reduction is a global public good. The costs of emissions abatement are borne by the country that reduces the emissions. The benefits of emission reduction are shared by all of humankind. It is thus individually rational to do very little, and hope that others will do a lot. As every country reasons the same way, nothing much happens,. There is no solution to this short of installing a world government.

(where I have marked with square backets two possible typos)

It seems to me that this book promises to be a superb contribution to the debate we really ought to be having about climate variation - those 5 paragraphs alone light up many topics worthy of more attention as they help explain how we got into the present mess of precipitate policy-making and polarised science.

Let us hope it will encourage such debate despite the widespread spin out there of 'the science is settled', 'the debate is over', 'sceptics are deniers', 'sceptics are stooges for Big X', 'think of the grandchildren', and no end of 'we only have n units of time left to save the world' - all of which have surely served to deflect many of us from deeper analysis, reflection, and discussion. The vivid but misleading terminology of 'greenhouse effect', while not the invention of climate opportunists, has also been frequently exploited by them in a drive to take political advantage of our relatively weak grasp of the detailed functioning of the climate system.

So I for one welcome this draft and look forward in hope of seeing the finished book make a big impact in due course.

Jan 22, 2013 at 12:56 PM | Unregistered CommenterJohn Shade

I am starting to consider the idea that climate skeptics are facing a situation similar to that of non-Christians in the days immediately following Constantine's decision to make Christianity an official religion. The Christians immediately got the emperor to sponsor a move to enforce orthodoxy and to suppress competing views. Pagans were suppressed and basically eradicated. Jews fared poorly, to put it mildly. Pagan holidays and beliefs were integrated into the emergent Christianity. Constantine, it is good to recall, was not a practicing Christian and was baptized on his death bed. AGW and the corrupt science and enviro-extremism that enables it may be making deeper roots in our social fabric than we realize.

Jan 22, 2013 at 1:31 PM | Unregistered Commenterlurker, passing through laughing

JS @ 12:56. That is an elegant excerpt of Richard. Simply reversing the equation in his fifth 'thing' solves the wicked problem. Once it is understood that anthropogenic emission of CO2 from fossil fuel is a good thing rather than a bad thing, the way forward seems more clear. Cooling is obviously more dangerous than warming, and Gaia is gasping for life sustaining CO2.

Jan 22, 2013 at 3:23 PM | Unregistered Commenterkim

Hey, Hunted; the Revolution will be Currently Televised.

Jan 22, 2013 at 3:24 PM | Unregistered Commenterkim

Richard, you lament that you have convinced few, but that is not really surprising.

Here's a little list from another thread of the disciplines involved in the climate sciences (cribbed from someone who knows): Climatology, Meteorology, Atmospheric dynamics, Atmospheric physics, Atmospheric chemistry, Solar physics, Historical climatology, Geophysics, Geochemistry, Geology, Soil Science, Oceanography, Glaciology, Palaeoclimatology, Palaeoenvironmental reconstruction, Ecology, Synthetic biology, Biochemistry, Global change biology, Biogeography, Ecophysiology, Ecological genetics.

My guess is that you, like me and most readers here, have no idea beyond the trivially obvious of what most of these entail, of the main areas of research or of the prevailing conclusions and theories for any of these disciplines. And yet you feel qualified to pronounce that the effects will be small. Do you seriously expect to convince scientists of your case?

If instead of basing the book on your preferred spin on the science, you based it upon a range of possible outcomes, from a small effect through medium to big, and analysed the best policy approach across these, you might be taken more seriously.

Jan 22, 2013 at 3:27 PM | Unregistered CommenterBitBucket

Tol is simply making an informed case for the obvious:
Any review of historic records based on empirical measure shows that 'climate change' is indeed a trivial problem. Any objective review of how climate extremists/climate concerned/cliamte activists are acting in the public sqaure shows that they rely on fanaticism and deception to compensate for the lack of evidence in support of their claims.
Herd thinking and corruption, noble and otherwise, fully account for this latest folly of the masses. Sadly, only time will convince believers such as yourself of this.

Jan 22, 2013 at 3:55 PM | Unregistered Commenterlurker, passing through laughing

Oops, meant to put "The alarum is a social mania. We'll learn." here.

Jan 22, 2013 at 4:00 PM | Unregistered Commenterkim

Lurker, you use many words but you have nothing to say beyond accusation. You'll fit in well here. Richard Tol is only likely to be able to make an "informed case" if he is thoroughly cognisant of the breadth of work in the climate sciences. Maybe he is - I hope he will tell us.

Jan 22, 2013 at 5:15 PM | Unregistered CommenterBitBucket

mmm..."Here's a little list from another thread of the disciplines involved in the climate sciences (cribbed from someone who knows): Climatology, Meteorology, Atmospheric dynamics, Atmospheric physics, Atmospheric chemistry, Solar physics, Historical climatology, Geophysics, Geochemistry, Geology, Soil Science, Oceanography, Glaciology, Palaeoclimatology, Palaeoenvironmental reconstruction, Ecology, Synthetic biology, Biochemistry, Global change biology, Biogeography, Ecophysiology, Ecological genetics"

doesn't this just boil down to a smattering of:

something with statistics in it

a long list of impressive-sounding names doesn't seem so very impressive when you consider the breadth of knowledge of people who have the individual disciplines in their job-titles rather than those sub-disciplines? I wonder how many of those sub-disciplines Jones, Mann et al lay claim to?

Jan 22, 2013 at 6:35 PM | Unregistered Commenterdiogenes

@ Diogenes Jan 22, 2013 at 6:35 PM

Exactly! But a non-scientist would not know this...and statistics is NOT a science, but a tool.

Jan 22, 2013 at 8:51 PM | Unregistered CommenterAlbert Stienstra

Bit Bucket,
Your assertion that one must be an expert in the entire field in order to have an opinion is a shallow bit of circular reasoning that disqualifies your own opinion. Your argument is the typical extremist faux reasoning that only recognizes opinions you like, and allows you to pretend critiques have no merit and serves only to allow reactionaries like you to ignore the question and cling to your faith.

Jan 22, 2013 at 9:05 PM | Unregistered Commenterlurker, passing through laughing

Since I have a smattering of all of your basic subjects, I guess I can call myself a climate scientist. Or anything else I like, for that matter.

I'm sure MartinA will be pleased to know what his lifetime's experience boils down to. By your recking, I guess engineering (any branch) involves just having a "smattering" of Physics, Chemistry and Math. Probably no more than high school level is sufficient if only a smattering is needed. And my doctor presumably has just a smattering of Biology and Chemistry despite it taking him nearly a decade to qualify. Slow learners I guess.

Jan 22, 2013 at 9:11 PM | Unregistered CommenterBitBucket

Lurker, where did I assert "that one must be an expert in the entire field in order to have an opinion"? You made that up. I said that for Richard to make an "informed case" (from your 3:55PM), he should be thoroughly cognisant of the breadth of work in the climate sciences. He can of course have an opinion however much he knows, but he shouldn't be surprised that nobody takes much notice of him if he makes assertions without being well informed.

Jan 22, 2013 at 9:21 PM | Unregistered CommenterBitBucket

The trouble is with this fine book that (as we learn from the new Augustine and Dutton paper in the Journal of Geophysical Research), CO2 contributed less than a quarter of the warming in the US between 1996 and 2011.

We also know as John Kehr explained beautifully in his book "The Inconvenient Sceptic" that CO2 contributes only (from memory) 3% of the gross total atmospheric warming effect. Even this tiny effect is limited to one narrow wave band that is already nearly totally saturated.

It does not look at all likely that however much CO2 we may emit in the future it will ever have any significant warming effect at all.

Richard has written a fine and serious book, but he takes the CO2 "science" and the "threat" of CO2 emissions seriously. The only sensible thing to do about CO2 emissions is nothing.

Jan 22, 2013 at 9:27 PM | Unregistered Commenterdave

Bit Bucket,
Run and hide. You seem to have quite a bit of practice.

Jan 22, 2013 at 11:07 PM | Unregistered Commenterlurker, passing through laughing

Lurker, Richard; Please do not feed the troll, buckethead is irritating enough without others feeding his ego.

Jan 22, 2013 at 11:07 PM | Registered CommenterSalopian

Bitty - is your aim to exemplify the stupidity of the alarmist?

Jan 22, 2013 at 11:45 PM | Unregistered Commenterdiogenes

Diogenes, do have a serious disagreement or something you think I ought to clarify, or are just into insults?

Jan 22, 2013 at 11:59 PM | Unregistered CommenterBitBucket

BB is in the Capt. Queeg phase of demonstrating his superiority to us all.

Jan 23, 2013 at 4:00 PM | Unregistered Commenterlurker, passing through laughing

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