20 April 2000

From Julian Morris

Climate Change

The climate has been and will continue to be in a state of flux. A rise of 1°C over the course of 100 years is far from dramatic and is likely to have benefits as well as costs.

Estimates of the maximum economic damage that might be dome by climate change under quite extreme scenarios (e.g. 3-4°C warming) are in the range 4-5 per cent of gross world product (the combined GDPs of all countries) by the year 2100. Since
gross world product is likely to rise by more than 100 per cent over that period, the effect would be that it would take an extra 1 or 2 years to reach a doubling of gross world product.

In light of this fact, should we really be putting on our hair shirts now?

By imposing swingeing restrictions on carbon dioxide emissions, the developed world will slow its rate of growth dramatically. Even if the effect is only to reduce average world growth rates by 0.1 per cent per year, the effect by 2100 would be a 10 per cent reduction in gross world product. THE COST OF TAKING ACTION MIGHT OUTWEIGH THE BENEFIT BY MORE THAN 2 TO 1.

Perhaps more importantly, climate change induced by man is far from the most significant crisis that might affect man.

Consider the risk of an asteroid impact or a giant volcano erupting; the effect of these events could be far more dramatic, leading to widespread global cooling (of perhaps 5°C), with attendant reductions in agricultural output.

To deal with such possible catastrophes it is imperative that the world economy grows as rapidly as possible because RICHER MEANS MORE RESILIENT.

Clearly there is a conflict here with the imposition of constraints on carbon dioxide emissions.

Julian Morris


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