The Stern Review is not, nor should it be, without its critics and cynics. These may focus on the science and/or on the economics and even extend to the personal and political. It is interesting that most news relating to the release of the review referred to Stern NOT as Head of the Government Economics Service or Second Permanent Secretary to the Treasury but as former chief economist to the World Bank. Furthermore, the Chancellor (who is also effectively a Prime minister in waiting) having commissioned the review seemed to make little of its recommendations in his recent Pre Budget Report and indeed with impeccable timing it was announced that Stern is to leave the Treasury.
The most common criticism remains in terms of the scientific basis of the Stern Review and it is inevitable that there are those who suggest that there is still not sufficient evidence that climate change is due to human activity or that even if it is that it will lead to catastrophe. It is clear that climate change extrapolations (and economics) rely heavily on mathematical modelling, which is very different from analysing real data from the past. Our best example of the everyday use of such complex modelling is ironically, the weather – and we know that “forecasts” sometimes have limited accuracy.
In the economic criticism the major weakness is inevitably the validity of extrapolating in an uncertain world further into the future than any “market” economist would dare to go. However, some economists have seen fit to focus on the figures and on the priority of focus on carbon reduction e.g. the return on investment for the reduction of carbon emissions in relation to minimising costs of practical issues like repairing damage to people’s houses. There is also much focus on the costs used, their manipulation and the models they relate to.
In addition to the criticisms above there are those who err on the side of Stern NOT being “Stern” enough.
Climate change author quits Treasury after Brown freezes him out
Pre Budget Report - Brown must tackle climate change
Pre-Budget Report – 6 December 2006
A Stern Review
Climate chaos? Don't believe it
Tol therefore called the report "alarmist and incompetent" (Word document)
Not Stern enough