The Copenhagen Consensus

Imagine that you are Bill Gates. Not to daydream about what to buy with a $58 billion fortune, but to consider how, like the Microsoft entrepreneur, you might give much of it away.

There are dozens of global challenges that could benefit from your philanthropy, but large as your financial resources are, they are not limitless. What would be your priorities? This week The Times is asking readers for their answers — while the Copenhagen Consensus project invites eminent economists to do the same.

An introduction to the Copenhagen Consensus 2008

Would your $50 billion be best spent on preventing the three great plagues of the modern era — malaria, tuberculosis and HIV, which claim tens of millions of lives each year?

Or might it be better to fund nutrition in developing countries, where almost 150 million children are underweight for their age and 200 million are chronically malnourished?

What about climate change, which many scientists consider to be the gravest threat of all? Should you invest in improving renewable energy technologies, to reduce reliance on fossil fuels?

Your choice would obviously be influenced by your social and political outlook, and by your perceptions of which challenges matter the most. But you might also want to be confident of getting a decent bang for your buck.

Is it possible to establish which of these challenges can be solved most cost-effectively, so that your generosity does the greatest good for the greatest number?

That is the question that a panel of eight economists, including five Nobel laureates, will attempt to answer next week, as the Copenhagen Consensus deliberates in the Danish capital.

Over the coming days, they will hear presentations from 30 specialists in particular global problems, each of whom will make the case for a menu of solutions in their fields.

Ten topics have been chosen for debate:
terrorism;
conflict;
malnutrition and hunger;
education;
the role of women;
air pollution;
subsidies and trade barriers;
disease;
sanitation and water;
and global warming.

The panel will decide on a league table, to guide investments by philanthropists, charities and governments.

The exercise is the brainchild of Bjørn Lomborg, the controversial Danish statistician whose 2001 book The Skeptical Environmentalist upset many scientists and green activists with a revisionist view of ecological issues.

The outcome of the first Copenhagen Consensus, held in 2004, proved equally contentious, not because of HIV’s place at the head of the list, but because of what was at the bottom.

Climate change is a reality, the panel argued, but the Kyoto Protocol was not a cost-effective way of addressing it. Limiting greenhouse-gas emissions would postpone the problem only slightly, and at unacceptable cost.

Some commentators considered this to be a thought-provoking injection of rationalism to an emotional debate. Others dismissed it as the consensus of a “random group” of economists lined up to endorse Dr Lomborg’s well-known scepticism about Kyoto.

Further criticism has been directed at the merit of considering these issues purely in terms of cost and benefit. Factors such as social justice, ecological stewardship and political acceptability are also important, but are exceptionally difficult to price.

Other development economists, such as Jeffrey Sachs, of Columbia University, think it misleading to present action on global warming, hunger and malaria as “either-or” options, when all these need to be addressed.

Dr Lomborg recognises these concerns, but argues that his initiative remains useful. “Clearly, there are other issues that matter as well as cost-benefit analysis,” he said. “But unless you put prices and values on things, it is difficult to make informed choices.

“What we’re doing is pricing up the menu. That doesn’t mean you have to pick the cheapest dish, or even the one that’s best value, but you want to know what they cost. Of course, it’s hard to compare carbon footprints with deaths from infectious diseases, but we often compare apples with oranges in everyday life. The challenge to these economists is to compare unlike with unlike as best they can.

“Too often, it’s the most photogenic and PR-friendly options that get priority. We want to step back and ask what’s actually most worthwhile.”

You can read more, and choose your own priorities here

I’ll let you know the results next week.

(from The Times, Saturday May 24 2008)

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