See the complete summary and video of the event
GDAE LogoGlobal Development And Environment Institute
at Tufts University

GDAE Awards 2015 Leontief Prizes to 

Duncan Foley & Lance Taylor

Lectures highlight macroeconomics and climate change

On March 23, the Global Development and Environment Institute (GDAE) awarded the 2015 Leontief Prize to Duncan Foley and Lance Taylor for their groundbreaking modeling of the macroeconomic impacts of climate change. GDAE Co-Director Neva Goodwin introduced the prizewinners, lauding them for their “creative and often innovative search for whatever tools and approaches will be most useful in finding real answers to real problems.” 
Dr. Foley’s talk refuted the idea that policies to control climate change will require significant sacrifices on the part of the current generation. He argued that as greenhouse gas emissions represent an uncorrected negative externality, reining them in will create large net gains that can be distributed amongst current and future generations in a variety of ways. Dr. Foley noted that while policies to address climate change will require perhaps 2% of world output, investments to address climate change are ultimately welfare-enhancing. With effective compensation schemes, the large available net gains imply that the current generation does not need to accept any reductions in living standards to address climate change. Thus there is reason to believe that politically viable climate policies are possible.
Dr. Taylor centered his presentation on the long-term economic impacts of rising greenhouse gas emissions. He discussed the results from a demand-driven model of growth and climate change to show the benefits from reducing greenhouse gas emissions. The model he presented includes several aspects usually missing from mainstream models, such as persistent unemployment and the link between productivity growth and labor energy consumption. A simulation for the business-as-usual scenario showed that a macroeconomic output crash caused by the damaging effects of climate change in the second half of the twenty-first century would result in substantial unemployment. In the scenario involving CO2 mitigation, the economy would stabilize with high wages and high employment in the long-term.
The awardees closed the event by engaging the audience in a lively conversation ranging from topics of decarbonizing the economy and the fossil fuel divestment movement, to incentivizing the equitable allocation of public goods.
Watch the Question & Answer Session
The day after the event, The Boston Globe ran a profile of the award winners.

Watch interviews with Leontief Prize Winners

Lance Taylor spoke with GDAE Research Fellow Jeronim Capaldo about failures of the mainstream economic models and the impacts of climate change on the economy.
Duncan Foley spoke with GDAE Senior Researcher Brian Roach about the “free-lunch doctrine” and financing investments to mitigate climate change.

About the Leontief Prize

GDAE inaugurated its economics award in 2000 in memory of Nobel Prize-winning economist and GDAE advisory board member Wassily Leontief. The Leontief Prize recognizes economists whose work, like that of the institute and Leontief himself, combines theoretical and empirical research to promote a more comprehensive understanding of social and environmental processes.

Read about the previous Leontief Prize winners

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