OK, I'm desperately trying to understand Stern, and failing. Things just don't seem to connect together properly. Possibly if I actually read the entire thing carefully... but who has the time. So, if anyone can explain to me:
Stern sez: Using the results from formal economic models, the Review estimates that if we don't act, the overall costs and risks of climate change will be equivalent to losing at least 5% of global GDP each year, now and forever. If a wider range of risks and impacts is taken into account, the estimates of damage could rise to 20% of GDP or more. But if you look at the damage-to-2100 from fig 6.5 (http://www.hm-treasury.gov.uk/media/8AC/CC/Chapter_6_Economic_modelling…) *none* of the scenarios get to 5% mean damage by 2100. And if you take "at least" to mean "lower 5%-ile" then 1% damage is more plausible.
Figure 6.2 clearly shows that some models of economic effects show -ve damage for low T rise: up to 2 oC for one model. But by figure 6.5, all T levels lead to +ve damages. So some of these econ models have been thrown away. On what grounds?
[Update: JQ has an attempt to defend Sterns discount rates here (see linked preprint). I don't find it convincing (nor does Tol) but it may be that there is rather more complexity to the choice than I thought. JA in the comments makes a bravce attempt to understand the issue.
To demonstrate how hard it is for the climate and econ side to talk together, JQ definitely gets it wrong when he says "A big problem with using Annan's work to discuss Stern is that the two are talking about different things." - they are, slightly, but that doesn't stop it being relevant, and suggesting that Sterns numbers are too high. JQ talks around that a bit, but fails to get the point -W]
I think that the costs go beyond 2100. JQ has a new post about the discounting, which I've not yet read.
Quiggan article on Critics of Sterne is a very good review that even lay readers like this person can follow.I would certainly hate to have a character like Nordhaus decide anything in the public policy area. He would deal with the goose with the golden eggs by selling the eggs, then killing the goose for meat, then I gues he would go to work for the fish farmers and help kill off the wild salmon by the transmission of lice that never heard of economic individualizing. A good account of the problem from a rational point of view is in Daly and Cobb, For the Common Good , Beacon Press, Boston, 1994, at pp.151 to 158.
How do you define rational? Take Nordhaus, set up the opposite, call it rational.
Try here for Quiggin (at least the beginning, there may be more): http://johnquiggin.com/index.php/archives/2006/11/19/the-stern-review-a…
Note Quiggin says: "A big problem with using Annan's work to discuss Stern is that the two are talking about different things."
Don't read this nonsense. It will just confirm you that it's nonsense.
Instead, look how another skeptic was converted to the catastrophic 20th century warming:
5 % of GDP forever is a lot!
[Certainly is. Do you mean "and therefore we should be worried" or "and therefore we should find his estimates implausible?" -W]
And is 'forever' like 'until the anthropogenic warming stops' -- presuming that'd be well after whenever the annual carbon sinks consume the annual human fossil fuel, whenever atmospheric GHG annually drops to net zero or less --- then add on the time for the then committed warming to either reach its peak, or even longer, til it drops back down to historical levels? So 'forever would be five hundred or a thousand years, or ten thousand?
er, duh ...
for "atmospheric GHG annually drops to net zero"
read "anthropogenic GHG ..."
But I guess any interval much longer than a career is 'forever' in economics.