Climate Change Will Bankrupt the Country | Climate-fueled disasters cost America almost a trillion dollars over the last year, far more than economists predicted.
Saleh @ Saleh @feddit.org Posts 120Comments 1,787Joined 12 mo. ago
Saleh @ Saleh @feddit.org
Posts
120
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1,787
Joined
12 mo. ago
Not so fun thing:
There is a whole debate about the "optimal" economic path during climate change, from a GDP perspective. One of the core issues is the question of interest rate. By assuming "market typical" interest rates around 1,4%, the future quickly gets discounted so much, that no matter the economic damage, because of the underlying growth assumptions, you end up with the Stern review marking 3°C as optimal economic outcome...
https://en.wikipedia.org/wiki/Stern_Review#Discounting
Discounting into the future, the whole interest rate and debt system, assuming growth... all of these are core positions of mainstream economics.
With the illusion of being a natural science rather than a social science, economics get way too much credit and of course there is a very problematic revolving door between financial institutions and economic research/education.