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Copenhagen Consensus is a project which seeks to establish priorities for advancing global welfare using methodologies based on the theory of welfare economics. It was conceived [1] and organized by Bjørn Lomborg, the author of The Skeptical Environmentalist and the Environmental Assessment Institute which he was heading at the time. The project was funded largely by the Danish government, and co-sponsored by The Economist. A book summarizing the conclusions, Global Crises, Global Solutions, edited by Lomborg, was published in October 2004 by Cambridge University Press. A second round is proposed for 2008. The Copenhagen Consensus Center [2] is now located at Copenhagen Business School. Welfare economics is a branch of economics that uses microeconomic techniques to simultaneously determine the allocational efficiency of a macroeconomy and the income distribution consequences associated with it. ...
Bjørn Lomborg Bjørn Lomborg (born January 6, 1965) is a Danish political scientist and former director of the Environmental Assessment Institute in Copenhagen. ...
The Skeptical Environmentalist: Measuring the Real State of the World (Danish: Verdens Sande Tilstand, literal translation: The Real State of the World) is a controversial book by political scientist Bjørn Lomborg, which argues that claims made about global warming, overpopulation, declining energy resources, deforestation, species loss, water shortages, and...
Environmental Assessment Institute (EAI) (Danish: Institut for Miljøvurdering) is an independent body under the Danish Ministry of the Environment. ...
Politics of Denmark takes place in a framework of a parliamentary representative democratic constitutional monarchy, whereby the prime minister is the head of government, and of a pluriform multi-party system. ...
It has been suggested that The Economist editorial stance be merged into this article or section. ...
Global Crises, Global Solutions is a book presenting the first conclusions of the Copenhagen Consensus, edited by Bjørn Lomborg, published in 2004 by the Cambridge University Press. ...
2004 (MMIV) was a leap year starting on Thursday of the Gregorian calendar. ...
The headquarters of the Cambridge University Press, in Trumpington Street, Cambridge. ...
Copenhagen Business School (Danish: Handelshøjskolen) was founded in 1917 in Copenhagen, Denmark. ...
The participants were all economists, with the focus of the project being a rational prioritization based on economic analysis. The project is based on the contention that, in spite of the billions of dollars spent on global challenges by the United Nations, the governments of wealthy nations, foundations, charities, and non-governmental organizations, the money spent on problems such as malnutrition and climate change is not sufficient to meet many internationally-agreed targets. This argument is supported by evidence from the World Bank, which estimates that the UN's Millennium Development Goals would cost an additional annual $40-$70 billion on top of the $57 billion already spent as of 2004 [3]; this increased expenditure would have to continue each year until 2015 in order to achieve the Millennium Development Goals. United Nations - Wikipedia, the free encyclopedia /**/ @import /skins-1. ...
A developed country is a country that is technologically advanced and that enjoys a relatively high standard of living. ...
A Foundation is a type of philanthropic organization set up by either individuals or institutions as a legal entity (either as a corporation or trust) with the purpose of distributing grants to support causes in line with the goals of the foundation. ...
Allegorical personification of Charity as a mother with three infants by Anthony van Dyck Charity, meaning selfless giving, is one conventional English translation of the Greek term agapē. // Etymology In the 1400, charity meant the state of love or simple affection which one was in or out of regarding one...
A non-governmental organization (NGO) is a non-profit group or association that acts outside of institutionalized political structures and pursues matters of interest to its members by lobbying, persuasion, or direct action. ...
Malnutrition is a general term for the medical condition caused by an improper or insufficient (undernourished) diet. ...
Variations in CO2, temperature and dust from the Vostok ice core over the last 400 000 years Climate change refers to the variation in the Earths global climate or regional climates over time. ...
Logo of the World Bank The International Bank for Reconstruction and Development (IBRD, in Romance languages: BIRD), better known as the World Bank, is an international organization whose original mission was to finance the reconstruction of nations devastated by WWII. Now, its mission has expanded to fight poverty by means...
The United Nations Millennium Development Goals are eight goals that all 191 UN member states have agreed to try to achieve by the year 2015. ...
2004 is a leap year starting on Thursday of the Gregorian calendar. ...
The emphasis on "rational priorization" is justified as a corrective to standard practice in international development, where, it is alleged, media attention and the "court of public opinion" results in priorities that are often far from optimal. The goal of international development is to alleviate poverty among citizens of developing countries. ...
Mass media is a term used to denote, as a class, that section of the media specifically conceived and designed to reach a very large audience (typically at least as large as the whole population of a nation state). ...
Process The process used by the project depends heavily on the expertise of reputable economists to evaluate the costs and benefits of addressing the ten major global challenges initially chosen by the project. Eight economists, including four Nobel winners, met May 24 - May 28, 2004 at a roundtable in Copenhagen. Ten stimulus articles were prepared by other economic experts, one on each of the challenges. Each article summarizes some current knowledge about one of the challenges, identifies from three to five opportunities to solve or ameliorate the problem, and contains cost and benefits estimates, calculated on particular assumptions with varying levels of uncertainty, related to the challenge. For each article, two critiques were written by other reputable economists, in an attempt to achieve a balanced perspective. At closed-door sessions the experts reviewed the articles and the critiques, and produced a ranking based on applied welfare economics of the 30-50 identified opportunities. The Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel (in Swedish Sveriges Riksbanks pris i ekonomisk vetenskap till Alfred Nobels minne), is a prize awarded each year for outstanding intellectual contributions in the field of economics. ...
May 24 is the 144th day of the year in the Gregorian calendar (145th in leap years). ...
May 28 is the 148th day of the year in the Gregorian calendar (149th in leap years). ...
2004 (MMIV) was a leap year starting on Thursday of the Gregorian calendar. ...
A meeting system is any systemic means of improving meetings, workshops or conferences. ...
Copenhagen (IPA: , rhyming with pagan, or , with a as in spa; Danish IPA: ) is the capital of Denmark and the countrys largest city (metropolitan population 1,115,035 (2006), at present made up of 16 municipalities. ...
Experts "Nobel Prize" winners marked with (¤) The Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel (in Swedish Sveriges Riksbanks pris i ekonomisk vetenskap till Alfred Nobels minne), is a prize awarded each year for outstanding intellectual contributions in the field of economics. ...
Jagdish Bhagwati (born 1934) is a prominent economist noted for his defense of free trade against the critics of globalization. ...
Robert William Fogel (born July 1, 1926) is an American economic historian and scientist, and Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel winner in 1993 (with Douglass North). ...
Professor Bruno S. Frey (born on May 4, 1941 in Basel, Switzerland) is a Swiss economists and one of the worlds leading welfare economists. ...
Justin Yifu Lin (林毅夫) is a Chinese economist, who is Founder and Director of the China Center for Economic Research, Professor of Economics at Peking University, and at the Hong Kong University of Science and Technology. ...
Douglass Cecil North (born November 5, 1920) is co-recipient of the 1993 Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel. ...
For the German philosopher see Friedrich Wilhelm Joseph von Schelling. ...
This article needs to be cleaned up to conform to a higher standard of quality. ...
Nancy Stokey is a professor of economics at the University of Chicago. ...
Challenges The author of the primary article about each challenge is also listed
The experts started with ten challenges and several "opportunities" within each:
The experts agreed to rate seventeen of the opportunities within seven of the ten challenges. Projects were rated in 4 groups: Very Good, Good, Fair and Bad Variations in CO2, temperature and dust from the Vostok ice core over the last 400 000 years Climate change refers to the variation in the Earths global climate or regional climates over time. ...
In medicine, infectious disease or communicable disease is disease caused by a biological agent such as by a virus, bacterium or parasite. ...
Conflict is a state of opposition, disagreement or incompatibility between two or more people or groups of people, which is sometimes characterized by physical violence. ...
The Summers memo was an excerpt of a 1991 memo signed by Lawrence Summers (though actually written by an aide, Lant Pritchett) who was, at the time, Chief Economist of the World Bank. ...
A currency crisis (also known as a financial crisis) occurs when the value of a currency changes quickly, undermining its ability to serve as a medium of exchange or a store of value. ...
Barry Eichengreen (born 1952)is an American economist who holds the title of George C. Pardee and Helen N. Pardee Professor of Economics at the University of California, Berkeley, where he has taught since 1987. ...
Malnutrition is a general term for the medical condition caused by an improper or insufficient (undernourished) diet. ...
For the 1983 horror film, see The Hunger. ...
Human migration denotes any movement by humans from one locality to another, often over long distances or in large groups. ...
Sanitation vehicle in New York City. ...
Water (from the Old English waeter; c. ...
This article or section contains information that has not been verified and thus might not be reliable. ...
A trade barrier is general term that describes any government policy or regulation that restricts international trade, the barriers can take many forms, including: Import duties Import licenses Export licenses Quotas Tariffs Subsidies Non-tariff barriers to trade Most trade barriers work on the same principle: the imposition of some...
Stylized rendering of a cross-section of the AIDS virus. ...
Stylized rendering of a cross-section of the AIDS virus. ...
Very Good The highest priority was assigned to implementing certain new measures to prevent the spread of HIV and AIDS. The economists estimated that an investment of $27 billion could avert nearly 30 million new infections by 2010. Human immunodeficiency virus (commonly known as HIV, and formerly known as HTLV-III and lymphadenopathy-associated virus) is a retrovirus that primarily infects vital components of the human immune system such as CD4+ T cells, macrophages and dendritic cells. ...
The Red ribbon is a symbol for solidarity with HIV-positive people and those living with AIDS. Acquired immunodeficiency syndrome or Acquired immune deficiency syndrome (AIDS or Aids) is a collection of symptoms and infections in humans resulting from the specific damage to the immune system caused by infection with...
Policies to reduce malnutrition and hunger were chosen as the second priority. Increasing the availability of micronutrients, particularly reducing iron deficiency anemia through dietary supplements, was judged to have an exceptionally high ratio of benefits to costs, which were estimated at $12 billion. Micronutrients for plants: There are about eight nutrients essential to plant growth and health that are only present in very small quantities. ...
Iron deficiency anemia is the most common type of anemia, and the most common cause of microcytic anemia. ...
A prescribed dietary supplement is intended to supply nutrients (usually vitamins or minerals) that are missing or not consumed in sufficient quantity in a persons diet. ...
Third on the list was trade liberalization; the experts agreed that modest costs could yield large benefits for the world as a whole and for developing nations. Anopheles gambiae mosquito a PD image courtesy of The Public Health Image Library http://phil. ...
Anopheles gambiae mosquito a PD image courtesy of The Public Health Image Library http://phil. ...
Free trade is an economic concept referring to the selling of products between countries without tariffs or other trade barriers. ...
A developing country is a country with low average income compared to the world average. ...
The fourth priority identified was controlling and treating malaria; $13 billion costs were judged to produce very good benefits, particularly if applied toward chemically-treated mosquito netting for beds. [4] Red blood cell infected with Malaria, derived from mala aria (Medieval Italian for bad air) and formerly called ague or marsh fever in English, is an infectious disease which causes about 350-500 million infections with humans and approximately 1. ...
Genera The mosquito is a member of the family Culicidae; these insects have a pair of scaled wings, a pair of halteres, a slender body, and long legs. ...
Good The fifth priority identified was increased spending on research into new agricultural technologies appropriate for developing nations. Three proposals for improving sanitation and water quality for a billion of the world’s poorest followed in priority (ranked sixth to eighth: small-scale water technology for livelihoods, community-managed water supply and sanitation, and research on water productivity in food production). Completing this group was the 'government' project concerned with lowering the cost of starting new businesses. Two key international agricultural research organizations are: The United Nations Food and Agricultural Organization. ...
Fair Ranked tenth was the project on lowering barriers to migration for skilled workers. Eleventh and twelfth on the list were malnutrition projects - improving infant and child nutrition and reducing the prevalence of low birth weight. Ranked thirteenth was the plan for scaled-up basic health services to fight diseases. A skilled worker is any worker who has some special knowledge or (usually acquired) ability in his work. ...
Low birth weight is defined by the World Health Organization (WHO) as a fetus who is delivered to a reproductive female at the end of a pregnancy at a weight of < 2500 grams (WHO, 1969). ...
Poor Ranked fourteenth to seventeenth were: a migration project (guest-worker programmes for the unskilled), which was deemed to discourage integration; and three projects addressing climate change (optimal carbon tax, the Kyoto protocol and value-at-risk carbon tax), which the panel judged to be least cost-efficient of the proposals. A carbon tax is any of several proposed taxes on energy sources which emit carbon dioxide into the atmosphere. ...
Kyoto Protocol Opened for signature December 11, 1997 in Kyoto, Japan Entered into force February 16, 2005. ...
A carbon tax is any of several proposed taxes on energy sources which emit carbon dioxide into the atmosphere. ...
Climate Change The panel found that all three climate policy to have "costs that were likely to exceed the benefits". It further stated "global warming must be addressed, but agreed that approaches based on too abrupt a shift toward lower emissions of carbon are needlessly expensive." [5]
In regard to the science of global warming, the paper relied primarily on the framework set by Intergovernmental Panel on Climate Change. Crucially, the project accept that greenhouse gas emitted from human activities to be the primarily cause of the global warming. In regard to the economics of global warming, the paper relies on various research studies published in the field of economics and attempt to compare the estimated cost of each policies against the expected reduction in the damage of the global warming from the policies. IPCC is science authority for the UNFCCC The Intergovernmental Panel on Climate Change (IPCC) was established in 1988 by two United Nations organizations, the World Meteorological Organization (WMO) and the United Nations Environment Programme (UNEP) to assess the risk of human-induced climate change. The Panel is open to all...
Cline, the author of the paper, set the discount rate, which is crucial in the cost benefit analysis to low rate of 1.5%. (Cline's summary is on the project webpage [6]) He justified his choice of discount rate on the ground of "utility-based discounting", that is there is zero bias in terms of preference between the present and the future generation (see time preference) and the discount rate is based on the expected decrease in the marginal benefit of three climate policies. This diverges from the conventional cost-benefit accounting, which simply bases the discount rate on the marginal cost of capital (i.e. interest rate). Moreover, Cline extended the time frame of the analysis to three hundred years in the future. Because the expected net damage of the global warming become more apparent beyond the present generation(s), this choice had the effect of inflating the present value cost of the damage of global warming as well as the benefit of abatement policies. Time preference is the economists assumption that a consumer will place a premium on enjoyment nearer in time over more remote enjoyment. ...
Members of the panel including Thomas Schelling and Robert Mendelsohn (both opponents of the Kyoto protocol) criticised the way this issue was handled in the Consensus project, particulaly the issue of discount rates. (See "The opponent notes to the paper on Climate Change" [7]) Mendelsohn, in particular, characterizing Cline's position, said that "[i]f we use a large discount rate, they will be judged to be small effects" and called it "circular reasoning, not a justification". Moreover, he argue that Cline's literature survey is not up-to-date. Citing various recent articles, including some of his own, he stated that "[a] series of studies on the impacts of climate change have systematically shown that the older literature overestimated climate damages by failing to allow for adaptation and for climate benefits." Moreover, he criticized the way in which the policy proposals are fixed in the analysis. In the Cline's paper, the present generation is responsible for the welfare of the future generations extending upto 300 years in the future. Instead, Mendelsohn argues that the each successive generation should be responsible for their own welfare i.e. each generation should respond to the global warming as it happens. This means that the current generation only needs to worry itself with the present net cost/benefit of the global warming. This, in turn, mean that the severity of three policy alternative does not need to adjusted to the 300 years in the future, and consequently, would not be as taxing.
After the results were published, members of the panel including Thomas Schelling and Robert Mendelsohn (both opponents of the Kyoto protocol) criticised the way this issue was handled in the Consensus project. The Economist quoted Mendelsohn as worrying that "climate change was set up to fail".[8].
Criticism The report, especially it's conclusion regarding the climate change was subsequently criticised from a variety of perspectives. The general approach adopted to set priorities was criticised by Jeffrey Sachs, an American economist and advocate of increased development aid, and Kyoto protocol [9], made numerous criticisms of the project arguing that the analytical framework was inappropriate and biased and that the project "failed to mobilize an expert group that could credibly identify and communicate a true consensus of expert knowledge on the range of issues under consideration." [10]. Bjorn Lomborg countered the criticism by stating that "Sachs disparaged the Consensus ‘dream team’ because it only consisted of economists. But that was the very point of the project. Economists have expertise in economic prioritization. It is they and not climatologists or malaria experts who can prioritize between battling global warming or communicable disease," [11] Jeffrey Sachs Jeffrey David Sachs (born November 5, 1954 in Detroit, Michigan) is an American economist known for his work as an economic advisor to governments in Latin America, Eastern Europe, the former Soviet Union, Asia, and Africa. ...
Under the heading "Wrong Question", Sachs further argued that
- "The panel that drew up the Copenhagen Consensus was asked to allocate an additional US$50 billion in spending by wealthy countries, distributed over five years, to address the world’s biggest problems. This was a poor basis for decision-making and for informing the public. By choosing such a low sum — a tiny fraction of global income — the project inherently favoured specific low-cost schemes over bolder, larger projects. It is therefore no surprise that the huge and complex challenge of long-term climate change was ranked last, and that scaling up health services in poor countries was ranked lower than interventions against specific diseases, despite warnings in the background papers that such interventions require broader improvements in health services."
Bjorn Lomborg argue that $50 billion were "an optimistic but realistic example of actual spending." "Experience shows that pledges and actual spending are two different things. In 1970 the UN set itself the task of doubling development assistance. Since then the percentage has actually been dropping". "But even if Sachs or others could gather much more than $50 billion over the next 4 years, the Copenhagen Consensus priority list would still show us where it should be invested first." [12]
In contrast, Tom Burke, a former director of Friends of the Earth, repudiated the entire approach of the project, arguing that applying cost-benefit analysis in the way the Copenhagen panel did was "junk economics". [13] John Quiggin, an economist and a self described social-democratic, commented that the project is a mix of "a substantial contribution to our understanding of important issues facing the world" and an "exercises in political propaganda" and argued that the selection of the panel menbers was slanted towards the conclusions previously supported by Lomborg [14]. Quiggin observed that Lomborg had argued in his controversial book, The Skeptical Environmentalist, that resources allocated to mitigating global warming would be better spent on improving water quality and sanitation, and was therefore seen as having prejudged the issues. John Quiggin (b. ...
The Skeptical Environmentalist: Measuring the Real State of the World (Danish: Verdens Sande Tilstand, literal translation: The Real State of the World) is a controversial book by political scientist Bjørn Lomborg, which argues that claims made about global warming, overpopulation, declining energy resources, deforestation, species loss, water shortages, and...
In addition, Quiggin argued that the members of the panel, selected by Lomborg, were, "generally towards the right and, to the extent that they had stated views, to be opponents of Kyoto." [15]. Sachs also noted that the panel members had not previously been much involved in issues of development economics, and were unlikely to reach useful conclusions in the time available to them.
Issues not considered The Copenhagen Consensus did not consider some issues, such as a cost-benefit analysis of the War on Terrorism. The direct financial spending on this issue dwarfs the money that the panels were allocated. In the introduction of Global Crises, Global Solutions, war and fighting terrorism are both covered as early possible candidates, but did not make the final list of 10 (later expanded to 17) issues with highest cost/benefit ratios. Also both were seen as primarily benefiting developed nations, not the targeted developing countries. The War on Terrorism or War on Terror (officially the Global War on Terrorism or GWOT[1]) is a campaign by the United States, NATO, and other allies with the stated goal of ending international terrorism by stopping those groups identified as terrorist groups, and ending state sponsorship of terrorism. ...
References - Sachs, Jeffery D. (12 August 2004). Seeking a global solution. Nature 430:725–726
August 12 is the 224th day of the year (225th in leap years) in the Gregorian Calendar. ...
2004 (MMIV) was a leap year starting on Thursday of the Gregorian calendar. ...
See also The Economic and Social Council (ECOSOC) of the United Nations assists the General Assembly in promoting international economic and social cooperation and development. ...
The UN Human Development Index (HDI) measures poverty, literacy, education, life expectancy, and other factors. ...
The well-being or quality of life of a population is an important concern in economics and political science. ...
The Canada Well-Being Measures Bill was proposed by Member of Parliament Marlene Jennings in 2001. ...
The physical quality-of-life index (PQLI) is an attempt to measure the quality of life or well-being of a country. ...
External links - The project's website
- The Economist's home page for the project
- SourceWatch entry on Copenhagen Consensus
- Criticism: Tom Burke: This is neither scepticism nor science – just nonsense: Why is Bjorn Lomborg's work on climate change taken seriously? The Guardian, 2004-10-23: 'Cost-benefit analysis can help you choose different routes to a goal you have agreed, but it cannot help you choose goals. For that we have politics.'
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