Tyler Cowen takes issue with one of Bjørn Lomborg’s central arguments in Cool It; specifically, Lomborg’s assertion that economists advocate only moderate policy changes to address global warming. One of Cowen’s more interesting caveats is that economists “do not even know enough moral philosophy to understand the issues involved (and the philosophers don’t understand enough economics), so there is no coherent consensus one way or the other.”
I’m not sure how much economic instruction it would take to bring a moral philosopher up to speed (or an economist training in philosophy) but I’m going to say that it’s a harder than it seems. There are lots of good representatives of specific moral communities (e.g. third-world populations) specific interests (e.g. wildlife, oceans) affected by global warming, and markets (e.g. economists), but none of them are properly linked. I think we’re looking at serious information constraints. Which is why I think some of the second (third or fourth best, really) options like raising CAFE standards aren’t a priori off the table, even though they are market distortions; there isn’t a very effective market (yet) for climate based economic policy.
Cowen also points out another glitch in developing a solution:
The strongest argument against significant action is not from cost-benefit analysis in the narrow sense, but simply that we are not very good at producing international public goods. Especially when it comes to extended, intertemporal collective action problems directed against small probability events, with unclear periodic feedback, and dealing with the Chinese and the Indians, who feel they have the right to pollute as much as we did, and also with the not-nearly-as-cooperative-as-they-might-sound Europeans (how’s that sentence for a mouthful?).
So not only is managing international institutions and regulations something of a crapshoot, but coordinating an international public good, which begins nowhere and can’t be excluded from use by any other country, is even more problematic.
If economic policy could benefit more from understanding moral philosophy and the vagaries of international regulation, I know my solution: how soon can we put Tyler Cowen, John Holbo, and Dan Drezner together in a room?