Premio Nobel all’economista che cerca il dialogo con le scienze dure | V. Bosetti

[google transl.] Nobel Prize to the economist who dialogues with the hard sciences

William Nordhaus is an undisputed pioneer of the climate change economy. His integrated assessment models are tools that allow a dialogue between the macroeconomic and climate systems, integrating discoveries from many disciplines.

[...] 

Models for an "open" science

These are some of Nordhaus' empirical works that have paved the way for countless econometric studies that look at the effects of temperature on economic growth, but the Nobel Prize's motivation makes explicit reference to his modelling work.

Integrated evaluation models, of which Bill Nordhaus is the undisputed pioneer, are tools that allow a dialogue between the macroeconomic and climate systems. The first was a simple linear programming model that allowed the demand for energy to be projected over a century. Then Dice was born (to get more information or just "play with it", this is the web page) which is a growth model like Ramsey, connected with a module that describes the carbon cycle and a module that describes the climate system. A damage function closes the cycle, describing the climate feedback on the economy. The model allows you to answer questions such as: What is the optimal path of emissions to maintain temperature growth below 2°C? What is the optimal temperature, taking into account the costs and benefits of climate change mitigation? What is the social cost of carbon?

One of Nordhaus's genius shots was to make the model totally "open source". On its website the equations, the code, the calibration, everything is meticulously described and absolutely reproducible. In the best spirit of open science, Nordhaus opens the door of integrated modelling to a whole generation of researchers. For those who know this shy and kind man, the gesture is the result of a genuine desire to confront each other on an equal footing, whatever the discipline they belong to, through the universal language of mathematics.

For economists, engineers, climate scientists and physicists, the Dice model, in its simplicity, allows infinite variations and developments (for example, stochastic versions or versions with endogenous technological change, versions with multiple regions that use basic concepts of game theory, versions that include sophisticated preferences towards inequality, versions with multiple or heterogeneous agents). In short, the door is open to all (there are thousands of job quotes describing the basic structure of the Dice model in scientific journals from many different disciplines). Even its major detractors or those who have written about potential shortcomings or weaknesses in its model recognize that criticism is possible precisely because Nordhaus has made the tool public - and thus improveable.