Nondogmatic Climate Policy
Disagreements about normative aspects of social time preferences have led to estimates of the Social Cost of Carbon (SCC) that differ by orders of magnitude. We investigate how disagreements about the SCC change if planners are non-dogmatic, i.e., they admit the possibility of a change in their normative views, and internalise the preferences of future selves. Although non-dogmatic planners may disagree about all the contentious aspects of social time preferences, disagreements about the SCC reduce dramatically. Admitting the possibility of a change in views once every 40 years results in a 4.6-fold reduction in the range of recommended SCCs.
We are grateful to Lint Barrage, Simon Dietz, Kieran Walsh, and seminar participants at UC Berkeley and Uppsala University for helpful feedback. Jaakkola thanks Rob Hart and the Swedish University of Agricultural Sciences for support while working on this project. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.