A new calculation for the social cost of carbon
Prof. Matthew Adler
Professor Matthew Adler is a longtime proponent of applying the theory of prioritarianism to complex public policy measurements in order to achieve policy solutions that give extra weight to the well-being of socially disadvantaged individuals and groups. In a recent paper titled “Priority for the worse off and the social cost of carbon,” (Nature Climate Change, May 2017), Adler and several co-authors introduce the notion of prioritarianism to the community of climate change scholars, proposing its use inquantifying the harm from carbon emissions.
“The Intergovernmental Panel on Climate Change, which is the main body which internationally coordinates academic efforts on climate change, has talked about prioritarianism in theory, but no one has really done the implementation work,” said Adler, the Richard A. Horvitz Professor of Law and Professor of Economics, Philosophy and Public Policy and founding director of Duke’s Center for Law, Economics and Public Policy (CLEPP). “So this article marries my interests with those of the economists and climate scientists who run the IAMs — the integrated assessment models — used to predict the effects of climate change.”
A key tool in climate policy, the social cost of carbon (SCC), “expresses in monetary terms the social impact of the emission of a ton of CO2 in a given year,” Adler and his co-authors write in their paper. SCC is often calculated by using a well-being measure that focuses on per capita global income and reduces, or “discounts,” the well-being of later generations. Criticisms of this method for calculating SCC have stressed its insensitivity to income distribution, and on the discounting of well-being over time.
“Prioritarianism is, in the philosophical and economic literature, a fairly well established idea,” Adler said. “But no one has really applied it before using this very detailed integrated assessment model to calculate the SCC. So that was the effort.”
Their end result was not a number, but an examination of methods by which to calculate SCC more fairly and realistically given the complex nature of global differences in well-being, Adler said. “It’s meant to spur future research using this notion of prioritarianism, giving more weight to the worse off, to think about problems in climate policy.”
CLEPP hosted a conference on the theory and application of prioritarianism at Duke Law in early October, where scholars participating in the Prioritarianism in Practice Research Network examined its utility to address such topics as climate change, taxation, health care, and education policy. The Research Network’s goal is to develop prioritarianism to function as a “full-blown policy assessment tool,” said Adler, who directs the network and planned the conference with Ole Norheim, a professor in the Department of Global Health at the University of Bergen.
“The conference was a great success,” Adler said. “We now have a coordinated plan for research in the different policy areas of the Research Network, which we hope eventually to publish as a book with a major university press.”