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The Hindu
6 days ago
- Science
- The Hindu
Is global warming becoming a distraction?
The story so far: A global mean temperature rise of 2°C is enshrined in the Paris Agreement as a safe level of global warming by 2100 with respect to the pre-industrial baseline. This threshold was reduced further to 1.5°C due to the demand from the Alliance of Small Island and Developing States. The climate community has since been trying to quantify climate change and its consequences relative to these warming levels. Unfortunately, the models scientists use for climate projections aren't perfect, which affects the uncertainties in global mean temperature rise estimates. To make predictions for years far beyond 2050, the models need to know the greenhouse gas emissions at the time. Modellers create these figures by imagining energy sources of the future, population growth, and climate actions and policies by then. However, it is anything but easy to simulate societies of the distant future. Thus, projections of global warming in the distant future depend heavily on uncertainties inherent to these speculative scenarios. Is global mean warming important? After 2023 and 2024 turned out to be record warm years, the spectre of crossing the 1.5°C threshold looms large. However, the 2°C warming threshold emerged from a rather arbitrary assumption rooted in the work of economics Nobel laureate William Nordhaus in the 1970s. There has been much debate since as to what this figure represents in real terms, because the two warming levels — 1.5°C and 2°C — aren't particularly special in climate science. In fact, there are uncertainties about the magnitude and/or duration of warming overshoot required for it to be catastrophic. The onslaught of climate-related disasters also makes it clear that any additional warming should be avoided. The exact amount of warming, whether 1.5°C, 1.75°C or 2°C, hardly matters for disaster management and adaptations required today. Did the world really cross 1.5°C? Global temperature estimates are prepared by blending observations and models. Also, multiple groups produce multiple models, which produce multiple estimates — and they are not alike. Two such models of late have claimed the world exceeded 1.5°C of warming in late 2024 whereas one has estimated the world didn't. Be that as it may, the question remains as to whether 2025 will continue to warm or if the rate of warming will drop. Rapid warming events in the past suggest that the rate of warming after sudden jumps tends to decline after a few years. For example, 2024 started out warm following the record warmth of 2023 before the rate of warming dropped. The rate in 2025 has already fallen below that seen in 2024 for the same months. Considering the uncertainties in warming plus irreducible uncertainties in estimating today's temperatures, it is confusing why global mean warming levels remain relevant. Climate adaptation and resilience require large investments. We also need reliable local information to avoid maladapting. Thus, climate mitigation must continue, in fact even accelerate while global mean warming is a distraction we can do without. But with the back-pedalling on climate action in some countries, short-and medium-term predictions, from days to a decade or two, are most urgent now, especially at the hyperlocal scale. What about climate disasters? Climate disasters like heatwaves, floods, and droughts are becoming more protracted, frequent, and intense. Insurance losses, number of lives, and number of livelihoods lost worldwide are rising year on year. These disasters are a reminder that unless researchers can pinpoint which disaster is likely to occur where and with sufficient actionable lead time — for example, a few days to few weeks for most extreme events — focusing on global mean warming can be wasteful, if not misguided. Early-warning systems and disaster management are becoming better overall and global plans under the UN, such as Early Warnings for All, promise to ensure poorer countries are not left out. If we are to manage day-to-day crises better even as the risks of climate hazards increase, we also need predictions at the decadal timescale to allow countries to plan ahead for adaptation and resilience. This in turn demands that we focus on tracking disasters, preparedness, management and recovery. The earth's tropics are a hotspot of climate change's consequences since they are warmer to begin with. So catastrophic floods outside the tropics, such as those in Valencia in 2024, are a stark reminder that good early warnings are worthless unless they are actionable up to the last mile. It has become common in the wake of disasters for some research groups to claim it was caused by global warming. However, we need to focus on more important questions: whether a given forecast was accurate and whether all disaster management agencies on the ground received it in time. If a forecast fails, they need to be recorded and documented as such; if a forecast was accurate but the government failed to prepare for it in time, the points of failure must be quickly identified and corrected. This acknowledges that climate risk and uncertainties are never zero, that risks are not predestined, and that we have agency in mitigating them. Raghu Murtugudde is retired professor, IIT Bombay, and emeritus professor, University of Maryland.
Economist
22-05-2025
- Business
- Economist
America's scientific prowess is a huge global subsidy
One of the best things about living in Europe is America. Faced with a moribund domestic stockmarket, European investors can redirect their savings into the s&p 500. Residents enjoy the protection of America's security umbrella without having to foot the bill. At times of crisis the continent's central banks rely on swap lines from the Federal Reserve. All the while they enjoy better food, nicer cities and superior cultural offerings. But America, under President Donald Trump, now threatens to withdraw many of these implicit subsidies. His administration's attacks on science, involving deep cuts to the budgets of institutions, may damage the biggest subsidy of all . America is a research powerhouse. It has the best universities. It accounts for 4% of the world's population, yet produces a third of high-impact scientific papers. It also accounts for a third of global research-and-development spending. Americans benefit most of all from their country's scientific prowess. The average American medical scientist earns $100,000 a year, for instance—some 60% more than the average American worker. But as any economist knows, knowledge is a public good, meaning science has large 'spillover' benefits. In 2004 William Nordhaus of Yale University argued that companies only capture 2.2% of the total returns from their innovations. Patents expire and even before that competitors copy ideas. Innovation therefore drags up everyone's living standards, as lots of companies become more productive and ordinary people benefit from better goods and services. America's average incomes are fantastically high. Economists have devoted less attention to the question of international spillovers. Nevertheless, America almost certainly runs a surplus in science with the rest of the world, providing much more to foreigners than it receives in return. In recent years, too, the size of this subsidy has almost certainly grown. Three mechanisms stick out—all of which are now under threat. First, people. American scientific institutions are a melting pot. There are twice as many foreign students today as in the early 2000s. Many outsiders, having graduated, return home, taking ideas with them. We estimate that around 15% of the people who have graduated from mit, a top American science school, live abroad. On that basis, the raw material of future scientific progress has already spilled out from America to elsewhere. Second, new ideas. When a scientist publishes a paper online, almost anyone in the world can read it. Traditionally research was a domestic affair. One bibliometric study found that in 1996 only about 40% of citations of American scientific publications were from foreign researchers. More recently the globalisation of scientific knowledge has intensified. By 2019 foreign scientists accounted for about 60% of America's citations. Scientists in the rest of the world thus stand on the shoulders of American giants. American consumers also subsidise r&d. This is most well-known in the case of pharmaceuticals. Prescription drugs are more expensive domestically than abroad. American consumers, in effect, pay for the research that creates them. And this pattern is apparent elsewhere, too. National-accounts data suggest that, on average, American corporations earn returns on domestic capital that are more than 50% higher than abroad. So while Americans may fund corporate r&d, the world shares the benefit. The third factor is new technologies. Every other country has long drawn from the well of American innovations. This was how Europe rebuilt itself following the second world war. French steel executives visited American steelworks in order to copy workflow designs. Britain's car bosses turned to American executives in an attempt to improve plant efficiency. Economists struggle to measure the ways in which American tech spills abroad today. In some cases the American government explicitly provides it to the world for free, as in the case of gps. During the covid-19 pandemic America gave away vaccines to poor countries. Many American artificial-intelligencecompanies release 'open source' models. Even when American firms try to protect their intellectual property, foreign competitors find workarounds. Many other smartphone companies have copied Apple's aesthetic, for instance. According to Nancy Stokey of the University of Chicago, one quantitative measure of technological spillovers involves looking at capital goods, in which new tech is often embodied. From the early 1990s to 2024 America exported nearly $5trn-worth of high-tech capital goods, more than any other country, spreading the American way to every corner of the Earth. Another proxy is outward foreign direct investment. This is when an American buys a controlling stake in a foreign business or builds a new industrial facility abroad—and often introduces new tech as part of the bargain. Americans' direct investments abroad are worth some $10trn, which is far more than any other country. Nutty professor If Mr Trump follows through with his proposed cuts, and America's scientific system stumbles, can another country pick up the mantle? Many American scientists say they want to leave the country; a few already have. China, which on some measures of scientific prowess already surpasses America, may hope to capitalise. Yet few foreigners want to do their phd in China. A closed political system slows down the diffusion of innovations across international borders. So does the language barrier. Even if China changed, however, decades of research on economic clusters shows that they are rarely replicated. Just as you could not uproot Hollywood and move it elsewhere, scientists leaving Berkeley and Boston will not carry on as before when they arrive in Beijing or, indeed, London. If America's scientific system sneezes, the rest of the world will catch a cold. ■
Wall Street Journal
07-05-2025
- Business
- Wall Street Journal
The Virtues of the ‘Knowledge Theory of Value'
William Nordhaus in Stockholm City Hall, Sweden, Dec. 10, 2018. Photo: jonathan nackstrand/Agence France-Presse/Getty Images Kevin Hoover suggests that William Nordhaus relied on the labor theory of value in his paper on light (Letters, April 24). Yet Nordhaus actually used knowledge, not labor. He offered a method to measure innovation: the discovery and sharing of valuable new knowledge. Nordhaus measured the amount of knowledge per unit of time and observed that knowledge about light was growing exponentially, surpassing traditional measures of economic development. It is the time price over time that truly deserves our attention. Economic theories offer different frameworks for understanding value, each rooted in distinct assumptions about what drives it, how it is measured and what it implies for economic systems. Adam Smith and Karl Marx proposed a labor-based theory of value, measuring 'surplus' and emphasizing scarcity, exploitation and redistribution. In contrast, we propose a 'knowledge theory of value,' grounded in abundance, innovation and entrepreneurship. This framework explains the vast differences between our age and the Stone Age. As Thomas Sowell observed, when we go to the market, we are trading knowledge, which creates value. We measure this creativity through time, specifically using time prices, the ratio of money prices to hourly income. As we discover and share more knowledge, time prices fall, reflecting increasing abundance.
