August 27, 2002
Skepticism Toward the Skeptical Environmentalist

I cannot be the only economist who was disappointed by Bjorn Lomborg's column in the New York Times on Monday, August 26. Lomborg makes a number of good points: it is definitely the case that we are pumping enough CO2 and other greenhouse gases into the atmosphere to warm the earth; that many of our environmental problems are the diseases of poverty, early industrialization, and the absence of democracy; that the Kyoto Protocol would be hideously expensive; that it would delay the warming trend for a decade at most; that projected temperature rises up to 2100 are bearable; and that it would almost surely be better to spend the resources that would be sucked up by the Kyoto Protocol on third-world public health and infrastructure instead. But as I read I kept waiting for another shoe to drop, and it did not. It seemed to me that Bjorn Lomborg's argument was radically and dangerously incomplete. It seemed to me that there were three more critical points that Bjorn Lomborg desperately needed to make, but did not. And because he did not it seemed to me that the net effect of his piece was not to reveal wisdom, but to darkeneth...

Posted by DeLong at 01:23 PM

August 16, 2002
Green Consumption

Richie Abrams, Professor of History here at Berkeley, and my part-time boss in his role as Associate Dean for International and Area Studies, has bought a Toyota Prius--one of the hybrid internal combustion-electric motor cars, that achieves extraordinary fuel efficiency (60 miles to the gallon?) by using the kinetic energy reduction accomplished during braking to charge up the battery. The only thing wrong with the car seems to be a lack of rear legroom... As he talked about the car, I couldn't help doing the math in my head, and finding that the financial side seemed to make the car's purchase nearly irresistible. Seven years of free maintenance--that's got to have a present value today of $2500. Increased efficiency implying a savings of $600 a year in gasoline costs at current prices--that's got to have a present value of $5000 today, plus whatever allowance for the risk of gasoline price changes we wish to include ($6500 in total?). Thus in buying a--fully-loaded--Prius, Richie paid $25000 and got back $9000 worth of maintenance, repair, and gasoline cost savings, for an NPV cost of only $16000. Plus he got enormous ecobragging rights, living as he does in North Berkeley. In a...

Posted by DeLong at 10:48 AM