Sunday 23 November 2014

Ten possible futures

Book review: In 100 Years: Leading Economists Predict the Future

Peter Coy

Published 01/05/2014 | 02:30

Global warming is the one theme all the essayists tackle
Global warming is the one theme all the essayists tackle
'In 100 Years'

We don't know what's going to happen 15 minutes from now, so it seems like an exercise in science fiction to predict what the world will look like in a century.

That hasn't stopped 10 economists who were invited to contribute essays to a new book called In 100 Years: Leading Economists Predict the Future, edited by Ignacio Palacios-Huerta of the London School of Economics.

Where a book like 'In 100 Years' is most useful is in the one arena for which a century-ahead forecast is valuable, even necessary: that's climate change.

In a collection that ranges all over the world, global warming is the one theme that all 10 essayists grapple with. Here's a quick review of the economists and what they say about the issue.

Acemoglu speculates that global warming can be solved by a motivated citizenry. He predicts that the "rights revolution" of the past several decades will continue, empowering ordinary people to demand more of leaders.

Deaton starts by writing that "unregulated climate change is a new and enormous danger" and concludes: "Perhaps there will have to be great suffering and destruction before people come together to make changes."

Dixit says reaching international agreement on climate change "will remain problematic", but notes "some side benefits" from warming.

Glaeser judges global warming to be a dangerous but solvable problem. Saying that climate change would "make extreme events more likely and increase sea levels generally", he continues: " ... while such disasters may cause great harm, historically these events have been localised and limited in their long-run impact".

The most optimistic essay in the volume predicts that a century from now, "we will have managed, due to the combination of natural growth and deliberate action, to completely eliminate poverty in the world".

Roemer says that in order to meet the twin goals of curbing global warming and reducing international wealth disparities, the rich nations will have to accept an increase in their incomes of only about 1pc a year over the coming century.

Roth gives the least attention to global warming. Climate change appears in parentheses in an otherwise optimistic sentence: "To set the stage, I think the biggest trend of future history (if it is not disrupted by environmental catastrophe, or descent into widespread terrorism, or warfare with weapons of mass destruction) is that the world economy will continue to grow and become more connected."

Shiller says that what society needs is long-term insurance that "protects homeowners against rising insurance premia because of long-term changes in environmental risks".

Solow writes: "Show me an economist with a strong opinion about these things, and I will show you that oxymoron: a daredevil economist."

Weitzman states: "If there is one genuinely natural bridge spanning the chasm between now and a century from now, I think it is climate change."

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