Yale professor and environmental economist William Nordhaus ’63 has written prolifically on the relationship between economics and climate change. In his new book “The Climate Casino,” Nordhaus hopes to elucidate the complexities and controversies of climate change for the general public. The News talked with Nordhaus about his inspiration for the book, its potential impact and the long-term politics of climate change in the modern world.
Q. What inspired you to write a book like this?
A. The inspiration was that people would ask me very often, “What’s a good book on climate change for nonspecialists?” And I would respond, “Hm, I don’t know that there is one.” So I thought, why don’t I just write one, a real short book that describes it for the people. It turned out to be a little longer than I thought, and turned out to take longer than I thought it would.
Q. Do you think the book ended up being accessible to a general audience?
A. It’s not for specialists, climate scientists or climate economists. It’s for people who are knowledgeable and interested in the subject; it’s written without any equations in it! I wouldn’t say it’s a populist or proselytizing book in any way, just an explanation of the issue at hand. The main aspect is that it focuses on the economy, and that it analyzes the unique contribution of economics.
Q. Could you give an example of this unique contribution of economics to the study of climate change?
A. The most important, I think, is that climate change is a malfunction of the price system, that emissions are underpriced. The main message from economics is that you have to get the price right, and that you have to raise the price of carbon emission, which is currently zero. It’s essentially an externality, where people impose costs on other people without compensating them. In this particular case, by burning fossil fuels and putting CO2 in the atmosphere, it causes harm to people now and in the future, here and around the world.
Q. From a more general perspective, how do you feel about attitudes to climate change in the United States? I recently came across a study that reported that about 40 percent of Americans don’t believe in the science behind global warming. How do you feel this popular perception impacts the politics and economics of the subject, as well as your book itself?
A. I actually did a fair amount of work on public opinion in this area. If you look at the evidence, it says that somewhere between 50 and 60 percent of people say that the globe is warming, but there is still a substantial amount of people who say that it’s not real. However, I don’t think that science is an opinion poll. Public opinion polls don’t ask what people think. If 80 percent of people were to say that there are witches, that wouldn’t be evidence that there are witches in Salem, Massachusetts. This is more of a political phenomenon — which we also need to deal with — than actual science.
Q. While public opinion polls may not reflect scientific truth, do you worry that efforts to mitigate global warming may be harmed by the fact that so many people in the United States don’t believe that the globe is warming?
A. I think it’s important to remember that this is a global phenomenon, which requires a global solution and pretty strenuous effort. It doesn’t have to be tomorrow, but it can’t wait indefinitely. The U.S. is in that way unusual and unique in having a system in which one of the major parties is very skeptical about global warming. It’s going to require effort and continued persuasion.
The struggle on smoking, which has been going on for 40 years now, is an analogy: From the 1950’s onwards it took patience, courage and continuous effort from the medical community to show people that smoking is dangerous for your health. I see this as a long-term effort, and we will continue to talk to people and persuade them to take steps.
Q. Do you feel optimistic about the future? How do you feel about the effort of Yale specifically?
A. I tend to be optimistic. Evidence continues to drip in, your roof is leaking and your house is getting wetter and wetter and eventually you realize, “Oh my god, my roof is leaking!” People will be convinced eventually, and they will see that you can take steps to curb climate change. I think the contribution of economics is to tell people to work through a mechanism such as a carbon tax which is embedded in the economy and can gradually reduce emissions. And people have estimated that this would only cost in the order of 1 percent of income over the next 20 years.
As for Yale specifically, I think we’re doing what universities do, which is, we‘re working on the science and the economics, trying to understand public attitudes, and providing courses where people can learn that. That is the contribution of the University. Yale is the leading university in terms of economics and climate change, and I think we’ve been doing more than our fair share in this area.