Much more research, reflection, and policy action have been dedicated to the mitigation of climate change than to adaptation. Both are important, and given the fact that climate change is already taking place and likely to accelerate, it is surely not too soon to begin taking adaptation seriously. This point is made in compelling fashion by Robert Pindyck, the Bank of Tokyo-Mitsubishi Professor of Economics and Finance at MIT’s Sloan School of Management, in the latest episode of our podcast, “Environmental Insights: Discussions on Policy and Practice from the Harvard Environmental Economics Program.” I hope you can find time to listen to our conversation here.
In these podcasts, I converse with leading experts from academia, government, industry, and NGOs. My long-time colleague and friend, Bob Pindyck, fits exceptionally well in this group, as a Fellow of the Econometric Society, a past President and Fellow of the Association of Environmental and Resource Economists, and – I’m pleased to say – an Associate Scholar of the Harvard Environmental Economics Program.
Although Professor Pindyck is well known as an energy economist, his research, writing, and expertise is much broader than that, which makes me think of two of his several books, namely a pair of text books co-authored with Daniel Rubinfeld of the University of California at Berkeley: Econometric Models and Economic Forecasts (which I found immensely helpful during my years in graduate school), andMicroeconomics, an intermediate textbook now in its 9th edition.
But over the past decade, Pindyck has spent much of his time bringing his expertise to bear on issues related to climate change and climate change policy. In fact, he is the author of the forthcoming book, “Climate Future: Averting and Adapting to Climate Change,” to be published by Oxford University Press. In our podcast conversation, Pindyck notes that his new book speaks to the role of uncertainty in the context of climate policy, both with regard to mitigation and adaptation:
“There is a lot we don’t know about climate change and how the system works. And my interest is what does that mean for policy? What do you do when you don’t know know certain things, when you’re uncertain, when many of the characteristics of the system are uncertain? So that got me interested in this,” he remarks.
“I’m very, very clear in the book that it’s extremely important to reduce emissions and that we have to do everything we can to reduce emissions quickly and as much as possible. But we also have to be realistic about what’s going to happen. Despite our best intentions, the world may not succeed and likely won’t succeed in reducing emissions enough to prevent a temperature increase [of] greater than two degrees. We can’t just make believe that we’re going to be able to do something that in fact we’re not going to do.”
Possibilities and policies for adaptation, Bob Pindyck points out, constitute a relatively new lens through which to view the future of climate change policy.
“What we’d like to do is to sharply reduce CO2 emissions and prevent a temperature increase of two degrees Celsius, and as I started doing a bunch of calculations, it just became clear to me that, that is very unlikely. And then the question is, what should we do if that’s very unlikely? Just say that’s too bad or what? And I came to the view that we need to start working now on adaptation to get ready for that possibility.”
Professor Pindyck suggests that solar geoengineering is just one example of potential measures that could help mitigate the impacts of climate change. The others, he notes, range from planting of trees to less construction of homes in flood zones.
Pindyck says that academics and policymakers must also focus more urgently on the social cost of carbon, and on defining an equitable discount rate that accurately addresses the costs and benefits that will accrue far into the future.
“This is simply an area where despite many, many years of work on discounting, we really don’t know how to address the issue of discounting climate damages that are going to happen 50 or a hundred years from now. What kind of discount rate do we use? Do we use market rates? Do we use ethical arguments for choosing a discount rate? If so, whose ethics?”
For this and much more, I hope you will listen to my complete conversation with Robert Pindyck, the 29th episode in the Environmental Insights series, with future episodes scheduled to drop each month. You can find a transcript of our conversation at the website of the Harvard Environmental Economics Program. Previous episodes have featured conversations with:
- Gina McCarthy, former Administrator of the U.S. Environmental Protection Agency
- Nick Stern of the London School of Economics discussing his career, British politics, and efforts to combat climate change
- Andrei Marcu, founder and executive director of the European Roundtable on Climate Change and Sustainable Transition
- Paul Watkinson, Chair of the Subsidiary Body for Scientific and Technological Advice (SBSTA) within the United Nations Framework Convention on Climate Change
- Jos Delbeke, professor at the European University Institute in Florence and at the KU Leuven in Belgium, and formerly Director-General of the European Commission’s DG Climate Action
- David Keith, professor at Harvard and a leading authority on geoengineering
- Joe Aldy, professor of the practice of public policy at Harvard Kennedy School, with considerable experience working on climate change policy issues in the U.S. government
- Scott Barrett, professor of natural resource economics at Columbia University, and an authority on infectious disease policy
- Rebecca Henderson, John and Natty McArthur University Professor at Harvard University, and founding co-director of the Business and Environment Initiative at Harvard Business School.
- Sue Biniaz, who was the lead climate lawyer and a lead climate negotiator for the United States from 1989 until early 2017.
- Richard Schmalensee, the Howard W. Johnson Professor of Management, and Professor of Economics Emeritus at the Massachusetts Institute of Technology.
- Kelley Kizier, Associate Vice President for International Climate at the Environmental Defense Fund.
- David Hone, Chief Climate Change Adviser, Shell International.
- Vicky Bailey, 30 years of experience in corporate and government positions in the energy sector.
- David Victor, professor of international relations at the University of California, San Diego.
- Lisa Friedman, reporter on the climate desk at the The New York Times.
- Coral Davenport, who covers energy and environmental policy for The New York Times from Washington.
- Spencer Dale, BP Group Chief Economist.
- Richard Revesz, AnBryce Professor of Law and Dean Emeritus, New York University School of Law.
- Daniel Esty, Hillhouse Professor of Environment and Law at Yale University.
- William Hogan, Raymond Plank Research Professor of Global Energy Policy at Harvard.
- Jody Freeman, Archibald Cox Professor of Law at Harvard Law School.
- John Graham, Dean Emeritus, Paul O’Neill School of Public and Environmental Affairs, Indiana University.
- Gernot Wagner, Clinical Associate Professor at New York University.
- John Holdren, Research Professor, Harvard Kennedy School.
- Larry Goulder, Shuzo Nishihara Professor of Environmental and Resource Economics, Stanford University.
- Suzi Kerr, Chief Economist, Environmental Defense Fund.
- Sheila Olmstead, Professor of Public Affairs, LBJ School of Public Affairs, University of Texas, Austin.