Less than infinity

2007-09-10 · Original WordPress address

I was at my new book club this weekend talking about Aristotle's Metaphysics. He makes the argument that if we are to truly understand something, then it must only have a finite number of causes. These sorts of arguments always bug me. Infinity is big, but finite and large can be very big, too. So mathematically, these proofs seem to say something, but in reality? Its not very satisfying to know that to truly understand something I need to know its 1,978,497,902 causes... Anyway, the other day I was saying that just because we need to do something about global warming doesn't mean that we should do everything. This was just me being too clever like Aristotle --- the argument, while true, doesn't get us anywhere. The important questions are being asked by Tyler Cowen:

Policy recommendations are extremely sensitive to the choice of discount rate, and economists do not agree on this issue. Furthermore most economists do not even know enough moral philosophy to understand the issues involved (and the philosophers don't understand enough economics), so there is no coherent consensus one way or the other. ((In other words, how much less do people value the future than today? How much should they?))

... Martin Weitzman... argues that the very high costs of the worst-case scenarios suggest an insurance-based case for significant worry...

We spend too much time wondering about what is "most believable" and not enough energy worrying about the expected value of pending losses...

Given that the value of risk is context-specific, economists are bad at taking the value of insurance from market data in one setting, and then transplanting that estimate to another setting.

The strongest argument against significant action is not from cost-benefit analysis in the narrow sense, but simply that we are not very good at producing international public goods...