I am in Cambridge MA in a hotel filled with economists. There are hundreds of economists who are all talking, talking, talking. In earlier years, I was one of the young guys but that is no longer true. Now, I'm one of the older guys. At lunch today, I talked to one of the younger guys about his work on persuasion and the contentious issue of climate change. Jesse Shapiro told me about his new paper.
Here is his abstract:
"A neutral expert sends an informative message to an uninformed voter. An interested party
can pay a cost to replace the expert’s message with its own. The more informed is the expert,
the greater is the interested party’s incentive to replace the expert’s message. In equilibrium,
making the expert more informed has no effect on the voter’s beliefs and strictly reduces social
welfare. The model thus implies an endogenous limit on how credible a purported expert can
be. I apply the model to public skepticism about climate change."
So, here is the nasty intuition. Before I spoke to Jesse, I had naively believed that climate scientists such as my colleagues at the UCLA Institute of the Environment would make progress understanding "the truth" about climate changes and through blogs and other forums such as PBS would educate the public about what they know and how they know it and this iterative learning process would lead to convergence over time such that by the year 2025 or so that we collectively would agree on what is "the new normal". This learning would mean that we all agree that the probability of unlikely events has increased such as what is the probability that there will be an extreme flood in a given month or extreme heat waves. The climate scientists would educate us about the causal links between global CO2 levels and the probability of nasty random events such as heat waves and droughts.
Shapiro's starting point is that interest groups who oppose carbon mitigation can invest their $ to pay their own experts to muddy up the water by encouraging this counter-group to launch their own efforts to disagree with the climate scientists. If the public doesn't know "who is an expert" and views all Ph.Ds as perfect substitutes then the public is less likely to be nudged by objective progress made by the "real" climate scientists. This interest group competition in the market for ideas is interesting and important.
On another note, a good friend of mine gently nudged me here to think about posting fewer blog entries about my book. I believe he believes that such posts have reached diminishing returns. Maybe there has been a convergence of beliefs about this point?
Finally, I have reopened the comments section of my blog now that I have the sense that students no longer read this blog. It turns out that a number of my friends read this blog and I will try to raise my game to deliver some good ideas and some funny ones!
UPDATE: I forgot to mention in my discussion of the Shapiro paper that his paper has implications for "free markets". His results suggest pessimism about there being a Congressional effort to mitigate carbon emissions (because the ideological divide on carbon mitigation will continue). But, don't forget about "free markets". Building on my usual Climatopolis optimism, I believe that there are private entrepreneurs who are sophisticated enough to know a "real climate scientist" when they see one. If these entrepreneurs become convinced of the new challenges we will face, they will devote their time and effort to start coming up with solutions. These solutions could earn them a fortune in our hotter future!