TCS Daily

Cracks In the 'Knowledge Monopoly'

By Hans H.J. Labohm - December 22, 2005 12:00 AM

This past July the UK House of Lords Select Committee on Economic Affairs issued its report on "The Economics of Climate Change". The members of the committee included five former Cabinet ministers, a former Financial Secretary to the Treasury, a former Governor of the Bank of England, a leading professor of economics, and a biographer of J. M. Keynes. All three main political parties were represented among the membership. The Special Adviser to the Committee was the late Professor David Pearce, one of the world's best-known environmental economists. The Committee's report was unanimous.

The report has been commented upon in the press by some highly reputed authors, including Peter Senker, Samuel Brittan and John Kay. The common denominator of their judgment was that the report was balanced and objective. A striking feature of the report was the doubts and concerns that it expressed about the Intergovernmental Panel on Climate Change (IPCC). These focused on the emissions scenarios which formed the starting point for the Panel's Third Assessment Report (TAR); the much-publicized "hockey stick" diagram showing temperature changes over the past millennium; and the treatment by the Panel of the possible impact of global warming on the incidence and spread of malaria and other vector-borne diseases. More generally, the report voiced "a concern that the IPCC has not always sought to ensure that dissenting voices are given a full hearing". It saw "a risk that IPCC has become a 'knowledge monopoly' in some respects..."

In late November, the government's official response to the report was published by the Department of the Environment, Food and Rural Affairs (DEFRA), which dismissively rejected the concerns expressed by the Select Committee. Instead, DEFRA stated its unqualified endorsement of the IPCC's work, role and procedures.

David Henderson, former chief economist of the Organization for Economic Cooperation and Development, described the DEFRA report this way:

"It did not so much address the arguments made by the House of Lords Select Committee as restate, reflex-like, the Whitehall and IPCC party line. It evinces an unshakable confidence in the status quo; and this goes with a reluctance to face, to understand properly, or even to recognize, unwelcome arguments and facts. Indeed, the response is itself an illustration of those features of the IPCC process and milieu which prompted the Select Committee's concerns."

DEFRA's rebuttal also triggered a more formal reaction by Henderson and three other leading British economists: Sir Ian Byatt, former Deputy Economic Adviser to the British Treasury; Sir Alan Peacock, former Chief Economic Adviser to the Department of Trade and Industry; and Professor Colin Robinson. In evidence submitted to the government-appointed "Stern Review", to be led by Sir Nicholas Stern, Head of the Government Economic Service, which will conduct a full-scale official inquiry into the economics of climate change, they recommended a critical examination of both British and international policies and procedures in this area. Referring to DEFRA's claim that the IPCC "assesses available literature rigorously", through its "two stage, fully documented peer review process", they argued that there was no attempt to meet, or refer to, the concerns that critics have voiced about this process.

First of all, these concerns relate to the flawed treatment of economic issues. The Panel's Third Assessment Report contains what many economists and economic statisticians would regard as basic errors, showing a lack of awareness of relevant published sources. In this area, the IPCC milieu is neither fully competent nor adequately representative. Moreover, the built-in process of peer review, which the IPCC views as a guarantee of quality, does not adequately serve this purpose. This is because providing for peer review is no safeguard against dubious assumptions, arguments and conclusions, if the peers are largely drawn from the same restricted professional milieu.

Moreover, the peer-review process as such, here as elsewhere, may be insufficiently searching. As University of Guelph professor of economics Ross McKitrick (who helped demolish the hockey-stick theory) has pointed out, its main purpose is to elicit expert advice on whether a paper is worth publishing in a particular journal. Because it does not normally go beyond this, "...peer review does not typically guarantee that data and methods are open to scrutiny or that results are reproducible."

That is why the authors backed a proposal by McKitrick to establish a formal audit procedure within the IPCC process, including an Audit Panel, appointed by member governments, and comprising experts not connected with climate science, which would ensure that, in relation to studies that the IPCC draws on, full disclosure conditions are met. The authors also favor a role for the central economic departments of state, for which the OECD, with its 30 member countries and its broad-based expertise, might offer the right forum.

Then there is the overarching question of whether it is desirable to strive for scientific consensus at all. As Henderson observes:

"Where there are pervasive uncertainties and wide differences of opinion, a striving after consensus is not appropriate, while it is unwise to place exclusive reliance on a single authorized source. These considerations would hold good even if the record of the IPCC were above question, which it is not. As in other spheres of action, provision should be made, in this case by governments, for establishing 'balance, disclosure and due diligence' in the conduct of the debate on climate change...

"I believe that, in the context of AR4 [the new, fourth Round of the IPCC], there should now be a more coordinated attempt to present a sustained unofficial critique of the IPCC process and what emerges from it, together with positive proposals for reform. Such a report should cover the whole range of issues and topics that are involved, economic as well as scientific, and its preparation should bring together an international team of writers and commentators. An unofficial Team B should be created for the purpose."

It is rather awkward that leading figures within the IPCC milieu seem incapable of coping with the competition of ideas. In many societal fields competition is regarded as indispensable for progress. It manifests itself in politics in the form of multi-party democracy. In economics it is the market which is built on competition. Ironically, long before competition emerged in these two fields, it was Socrates who laid the foundation for competition of ideas in science. Somewhere in their quest for a human fingerprint in climate change, climatologists must have forgotten his lessons. That is sad. One can only hope that the attempts by critical scientists to break down the -- so far -- impenetrable walls of cognitive dissonance, behind which many leading figures in the IPCC milieu shield themselves, will be crowned with success.

The author recently became an expert reviewer of the IPCC.

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