The dollars-and-cents of global warming is now a welcomed topic among economists and governments. One can thank Sir Nicholas Stern for that. Last October, his report put a price tag on what must be done. Since then, others have chewed over his numbers.
As head of Britain's Government Economic Service, Dr. Stern led a team that estimated a cost to the task of cutting greenhouse-gas emissions by a necessary 80 percent (to settle at about twice their preindustrial concentrations) by 2100: The world's economic growth rate would be shaved about 1 percentage point a year if all the necessary regulations, taxes, and carbon-trading schemes were in place.
Stern's team also calculated the cost of not taking action. If the world conducted business as usual, the effects of warming could cut GDP growth rates by at least 5 percent and as much as 20 percent a year indefinitely. The trade-off seemed clear: Taking action is less expensive than neglect.
But wait. Despite its high profile, the study is hardly the final word – a point Sir Nicholas himself makes clear. Last week, he made the rounds in Washington to talk up his report and then went to Yale University to present his work to a group of fellow economists and endure the closest thing to peer review his report has yet received.
Some challenged its conclusions as too stark or not stark enough; others praised it. But in the end nearly everyone agreed it provides a valuable point of departure for a deeper look at the economic choices. As one panelist put it, the report is a "full-employment act" for economists, who aim to shore up what they see as its shortcomings or to take it in directions Stern didn't have time for.