Robert Pindyck on Climate Change

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4.7 • 4.4K Ratings

🗓️ 5 August 2013

⏱️ 65 minutes

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Summary

Robert Pindyck of MIT talks with EconTalk host Russ Roberts about the challenges of global warming for policy makers. Pindyck argues that while there is little doubt about the existence of human-caused global warming via carbon emissions, there is a great deal of doubt about the size of the effects on temperature and the size of the economic impact of warmer climate. This leads to a dilemma for policy-makers over how to proceed. Pindyck suggests that a tax or some form of carbon emission reduction is a good idea as a precautionary measure, despite the uncertainty.

Transcript

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0:00.0	Welcome to Econ Talk, part of the Library of Economics and Liberty. I'm your host Russ Roberts
0:08.4	of Stanford University's Hoover Institution. Our website is econtalk.org where you can
0:14.2	subscribe, comment on this podcast, and find links and other information related to today's
0:18.7	conversation. You'll also find our archives where you can listen to every episode we've
0:23.1	ever done going back to 2006. Our email address is mailadycontalk.org, we'd love to hear
0:29.2	from you. Today is July 30, 2013, and my guest is Robert Pindike, the Bank of Tokyo Mitsubishi
0:40.2	Professor of Economics at MIT. He's the author of numerous articles in the area of the economics
0:46.4	of climate change, industrial organization, energy, and investment under uncertainty. He's
0:51.8	a research associate at the National Bureau of Economic Research. Bob, welcome to Econ Talk.
0:57.5	Thanks. Nice to be here. Now, our topic today is climate change, a subject you've written
1:02.8	on lately, and we'll put links up to those papers. I want to start with what you call the climate
1:07.2	change dilemma. What is the dilemma? Well, I think the dilemma is that we'd like to get a sense of
1:15.7	just how far to go in terms of responding to the threat of climate change, just how far to go
1:21.7	in terms of abatement. Should we have a very stringent abatement policy in terms of limiting how
1:29.6	much carbon dioxide and other greenhouse gases we produce, or should we begin slowly and then
1:35.9	perhaps later increase the extent of abatement? And the problem is it's very difficult to come up
1:43.0	with numbers that actually tell you what the right solution is, how far to go. We know that
1:53.0	global warming climate change is a problem. We know that we have to do something, but we don't know
1:58.2	quite how much we have to do at this point. And that's really the dilemma. I want to start with
2:04.3	a little thought experiment that you do in one of your papers, which is to say, let's suppose
2:09.4	we know exactly what's going to happen to the temperature over the next 100 years, and we even
2:18.2	know what the likely effects are on human well-being and in terms of financial or monetary loss.
	...

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