Wednesday, 11 October 2017

You keep parroting yourself on this point

New comment on your post "Morality and economics"
Author: Kevin ONeill
Comment:


WC writes:"[...But the criticism of Stern was by mainstream economists, and doesn’t. I can’t decide if you’re so out of touch with the mainstream that you don’t know where it is, or if you’re being deliberately misleading -W]"

You keep parroting yourself on this point, but you never really have offered any evidence of it.  Stern's formula was based on *mainstream* economic theory.  It was supported by many *mainstream* economist.

What is true is that Nordhaus denigrated his choice of social discount rate and that the only real difference between the two was more specifically within the social discount rate the PRTP.

So there were  *mainstream* economists that lauded Stern's Review and there were some that didn't.  I've never seen *any* evidence - nor have you ever provided evidence -  that the majority fell one way or another at the time of publication.

We *do* know that since then the majority believe Stern's discount rate was too *high* and by inference Nordhaus was really, really wrong.  And that's the point you still refuse to address; who cares if mainstream economists thought he was wrong then?  Today they think the discount rate should be even lower.  Recent observatios and experience suggest they may *still* be too high even yet as more and more economists tend toward a belief in negative discounting.

I'm really not sure why you put yourself in a position of defending a past criticism that proved out to be incorrect - whether it was held by the majority or not.  Is it that difficult to admit that Stern's discount rate turned out to be appropriate after al and that maybe it should have been even lower?

BTW, Richard Thaler gets the Nobel Prize for Economics this time around.  That's two shots at the whole EMH and Rational agents crowd in just the past 5 years.  I think we know where mainstream economic thinking now lies.  Some people adjust to new evidence.  The Nobel Committee has, that's for sure.

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