I don’t have much time but I nevertheless would like to note the awarding of Nicholas Stern and Martin Weitzman, two distinguished climate economists, with the Leontief Prize of 2011. More below (it is the press release from the Global Development and Environment Institute):
Tufts University’s Global Development And Environment Institute announced today that it will award its 2011 Leontief Prize for Advancing the Frontiers of Economic Thought to Nicholas Stern of the London School of Economics and Harvard’s Martin Weitzman. The award recognizes the critical role played by these researchers in analyzing the economic dimensions of climate change. The ceremony and lectures will take place on March 8, 2011 at Tufts University’s Medford campus.
“Climate change is a fundamental challenge to the survival of human civilizations. It also poses a critical challenge to economic theory and practice,” says GDAE Co-director Neva Goodwin. “Nicholas Stern and Martin Weitzman have vigorously and effectively addressed that challenge, demonstrating with theoretical rigor and empirical analysis that we can afford the economic adjustments needed to address climate change. In fact, we can’t afford not to.”
The Global Development And Environment Institute, which is jointly affiliated with Tufts’ Fletcher School of Law and Diplomacy and the Graduate School of Arts and Sciences, inaugurated its economics award in 2000 in memory of Nobel Prize-winning economist and Institute advisory board member Wassily Leontief, who had passed away the previous year. The Leontief Prize for Advancing the Frontiers of Economic Thought recognizes economists whose work, like that of the institute and Leontief himself, combines theoretical and empirical research to promote a more comprehensive understanding of social and environmental processes. The inaugural prizes were awarded in 2000 to John Kenneth Galbraith and Nobel Prize winner Amartya Sen.
Nicholas Stern brings a long and distinguished history of research on the economics of development, but he is best known for his path-opening Stern Review on the Economics of Climate Change. This comprehensive assessment directly challenges the assertion, common in the field of economics, that the costs of addressing climate change outweigh the benefits. Demonstrating the theoretical fallacies in such arguments, and highlighting the importance of both international and intergenerational equity, Stern called for prompt and aggressive action to reduce greenhouse gas emissions. He has stated that climate change calls for “radically transformed development paths on the back of a technological revolution” and that “publicly supported low-carbon development can both create jobs, reduce risks for our planet and spark off a wave of new investment which will create a more secure, cleaner and attractive economy for all of us.”
Stern has served as Chief Economist and Senior Vice-President of the World Bank (2000 – 2003) and as Chief Economist and Special Counsellor to the President of the European Bank for Reconstruction and Development (1994 – 1999). He is now the I.G. Patel Professor of Economics and Government and the Chair of the Grantham Institute for Climate Change and the Environment at the London School of Economics (LSE). In the academic year 2009-10, he was Professor at the Collège de France.
Martin Weitzman, a Professor of Economics at Harvard University, has distinguished himself for his work on the economics of uncertainty and, in recent years, the implications for understanding climate change. While most economic models focus on the likely range of projected climate scenarios, Weitzman has argued that, given the levels of uncertainty about the extent and impacts of climate change and the prohibitively high costs of extreme climate disaster, economic analysis should pay special attention to the risk of a climate catastrophe.
This builds on earlier theoretical contributions. Weitzman demonstrated the theoretical basis for using declining discount rates over time in long-run economic modeling. His seminal work in 1974 focused on the use of price versus quantity controls in economic policy, an issue that has renewed relevance in the policy debates over carbon taxes (a price-based instrument) or a cap-and-trade system (a quantity-based policy). Weitzman’s insight that uncertainty affects the choice of the optimal policy measure has important implications for a range of environmental regulatory regimes. Weitzman’s 1984 book, The Share Economy: Conquering Stagflation, demonstrated the value of basing wages on profit-sharing, with employees receiving higher wages when a company is doing well.
The Global Development And Environment Institute was founded in 1993 with the goal of promoting a better understanding of how societies can pursue their economic and community goals in an environmentally and socially sustainable manner. The Institute develops textbooks and course materials, published on paper and on its web site, that incorporate a broad understanding of social, financial and environmental sustainability. The Institute also carries out policy-relevant research on globalization, climate change, and the role of the market in environmental policy.
In addition to Amartya Sen and John Kenneth Galbraith, GDAE has awarded the Leontief Prize to Paul Streeten, Herman Daly, Alice Amsden, Dani Rodrik, Nancy Folbre, Robert Frank, Richard Nelson, Ha-Joon Chang, Samuel Bowles, Juliet Schor, Jomo Kwame Sundaram, Stephen DeCanio, José Antonio Ocampo, Robert Wade, Bina Agarwal, and Daniel Kahneman.