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Archive for May 13th, 2010

The Real World Economics Review Blog announced the winners of the Revere Award for

the three economists who first and most clearly anticipated and gave public warning of the Global Financial Collapse and whose work is most likely to prevent another GFC in the future.

I voted for Keen, Baker, and Stiglitz (who came in 4th). Roubini is way too hawkish (deficit style, that is) for my tastes, although I haven’t read enough of or about his work to divine a guiding paradigm. Stiglitz obviously has his shortcomings, but he’s probably the best prominent economist available in the mainstream for the award’s stated cause. As for Keen and Baker, they’re simply all-stars. I’m sure some others on the list are as well, but I didn’t know enough about them to cast an informed vote. More info on all the finalists here.

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I just started reading Paul Collier’s new book The Plundered Planet: Why We Must–and How We Can–Manage Nature for Global Prosperity, which was released this week. I’m going to do a proper review of it in a couple of weeks, but the first chapter struck me in light of my post from two weeks ago about why environmentalists don’t trust economists. In the book, Collier will apparently try to play the role of referee between two factions- romantics and ostriches. Romantics are skeptical of growth and want to preserve at all costs, while ostriches will plunder nature for the cause of economic growth.

Although many may not admit it, I think there are a lot of both types within the margins of the environmental discussion. There are enough, in fact, to build the mistrust I was posting about. Collier attributes the existence of both camps to a misinformed public. Interestingly, though, he seems to ascribe more blame to economists, who treat nature “as they do any other asset…to be exploited for the benefit of mankind.” He then aptly cites Nicholas Stern (whose higher carbon price has been mostly ignored since its release in 2006), who has argued that the issues with climate change “are not technical, but ethical.”

His words for economics are harsh:

As adopted by economists, Utilitarianism is an austere, universal value system that is impossibly demanding…Given the gulf between the values economists use to judge the world and the values they assume ordinary people to hold, many economists conclude that ordinary people cannot be trusted adequately to protect the interests of the future.

That value gulf, I think, is the key issue. Economists don’t just dislike the values of environmentalists- they don’t trust them to the point that they position themselves to make value judgments, hidden in technospeak. Environmentalists know this and thus don’t trust them, and we end up with a vicious cycle that radicalizes both sides and results in mistrust. Will Paul Collier broker a compromise? Stay tuned.

Disclosure: I was sent a copy of the book by the publisher, Oxford University Press. This post and my forthcoming review are of my own volition, not in exchange for receipt of the book.

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