How to Spend $50 Billion to Make the World a Better Place Read online

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  HOW TO SPEND $50 BILLION TO MAKE THE WORLD

  A BETTER PLACE

  In a world fraught with problems and challenges, we need to gauge how to achieve the greatest good with our money. This unique publication provides a rich set of dialogs examining the most serious challenges facing the world today:

  r climate change

  r communicable diseases

  r conflicts and arms proliferation

  r access to education

  r governance and corruption

  r malnutrition and hunger

  r migration

  r sanitation and access to clean water

  r subsidies and trade barriers.

  Each problem is introduced by a world-renowned expert who

  defines the scale of the problem and examines a range of policy options. Shorter pieces offer alternative positions.

  This abridged version of the highly lauded Global Crises, Global Solutions provides a serious yet accessible springboard for debate and discussion on the world’s most serious problems and what we can do to solve them.

  Bjørn Lomborg is Adjunct Professor in the Department of Management, Politics, and Philosophy at the Copenhagen Business School.

  He is also the author of the controversial bestseller, The Skeptical Environmentalist (Cambridge, 2001).

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  How to Spend

  $50 Billion

  to Make the World

  a Better Place

  Edited by

  Bjørn Lomborg

  Copenhagen Business School

  iii

  CAMBRIDGE UNIVERSITY PRESS

  Cambridge, New York, Melbourne, Madrid, Cape Town, Singapore, São Paulo Cambridge University Press

  The Edinburgh Building, Cambridge CB2 8RU, UK

  Published in the United States of America by Cambridge University Press, New York

  www.cambridge.org

  Information on this title: www.cambridge.org/9780521866798

  © Copenhagen Consensus Center 2006

  This publication is in copyright. Subject to statutory exception and to the provision of relevant collective licensing agreements, no reproduction of any part may take place without the written permission of Cambridge University Press.

  First published in print format 2006

  ISBN-13 978-0-511-54069-1

  eBook (NetLibrary)

  ISBN-13 978-0-521-86679-8

  hardback

  ISBN-13 978-0-521-68571-9

  paperback

  Cambridge University Press has no responsibility for the persistence or accuracy of urls for external or third-party internet websites referred to in this publication, and does not guarantee that any content on such websites is, or will remain, accurate or appropriate.

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  Contents

  Contributors

  page vii

  Introduction

  xi

  1 Meeting the Challenge of Global Warming . . . . . . . . . . 1

  William R. Cline

  CLIMATE CHANGE – OPPONENTS’ VIEWS

  14

  2 Communicable Diseases . . . . . . . . . . . . . . . . . . . . . . 19

  Anne Mills and Sam Shillcutt

  COMMUNICABLE DISEASES – OPPONENTS’ VIEWS

  33

  3 The Challenge of Reducing the Global Incidence

  of Civil War . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

  Paul Collier and Anke Hoeffler

  THE CHALLENGE OF CONFLICTS – OPPONENTS’ VIEWS

  53

  4 Toward a New Consensus for Addressing the Global

  Challenge of the Lack of Education . . . . . . . . . . . . . . . 57

  Lant Pritchett

  THE CHALLENGE OF LACK OF EDUCATION – OPPONENTS’

  VIEWS

  71

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  Contents

  5 The Challenge of Poor Governance and Corruption . . . 77

  Susan Rose-Ackerman

  THE CHALLENGE OF POOR GOVERNANCE AND

  CORRUPTION – OPPONENTS’ VIEWS

  90

  6 Hunger and Malnutrition . . . . . . . . . . . . . . . . . . . . . . 95

  Jere R. Behrman, Harold Alderman, and John Hoddinott

  HUNGER AND MALNUTRITION – OPPONENTS’ VIEWS

  108

  7 Population and Migration . . . . . . . . . . . . . . . . . . . . . 113

  Philip Martin

  POPULATION: MIGRATION – OPPONENTS’ VIEWS

  125

  8 The Water Challenge . . . . . . . . . . . . . . . . . . . . . . . . 129

  Frank Rijsberman

  THE WATER CHALLENGE – OPPONENTS’ VIEWS

  141

  9 Subsidies and Trade Barriers . . . . . . . . . . . . . . . . . . . 147

  Kym Anderson

  SUBSIDIES AND TRADE BARRIERS – OPPONENTS’ VIEWS

  160

  Expert Panel Ranking

  165

  Index

  175

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  Contributors

  Chapter Authors

  Harold Alderman is Lead Human Development Economist in the Africa Region of the World Bank, Washington, DC.

  Kym Anderson is Lead Economist in the International Trade Unit of the World Bank’s Development Research Group.

  Jere R. Behrman is William R. Kenan, Jr., Professor in Economics and Director, Population Studies Center, University of Pennsylvania.

  William R. Cline is Senior Fellow, Institute for International Economics and the Center for Global Development in

  Washington, DC.

  Paul Collier is Professor and Director of the Centre for the Study of African Economies, Oxford University.

  John Hoddinott is Senior Research Fellow in the Food Consumption and Nutrition Division of the International Food Policy Research Institute, Washington, DC.

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  viii

  Contributors

  Anke Hoeffler is Research Associate of the Centre for the Stud
y of African Economies, Oxford University.

  Philip Martin is Professor and Chair, UC Comparative Immigration and Integration Program, University of California, Davis.

  Anne Mills is Professor of Health Economics and Policy, London School of Hygiene & Tropical Medicine.

  Lant Pritchett is Lead Economist of the Environment and Social Unit at the World Bank.

  Frank Rijsberman is Director General, International Water Management Institute, Colombo, Sri Lanka; Professor at

  UNESCO-IHE, International Institute for Water Education,

  Delft, and Wageningen University and Research, Wageningen.

  Susan Rose-Ackerman is Henry R. Luce Professor of Jurispru-dence, Yale University, Law School and Department of Political Science.

  Sam Shillcutt is Research Fellow in the Health Economics and Financing Programme, London School of Hygiene and Tropical Medicine.

  Perspective Paper Authors

  Tony Addison is Professor, Deputy Director, Project Director and Senior Research Fellow, World Institute for Development Economics Research (WIDER) of the United Nations University (UNU).

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  Contributors

  ix

  Jens Christopher Andvig is Senior Researcher, University of Oslo.

  Simon Appleton is Senior Lecturer in Economics, School of Economics, University of Nottingham.

  Roger B öhning is Director, Programme on Promoting the Declaration on Fundamental Principles and Rights at Work,

  International Labour Office, Geneva.

  John Boland is Professor Emeritus, Environmental Economics and Policy, Department of Geography and Environmental

  Engineering, The Johns Hopkins University.

  Jean Cartier-Bresson is Professor of Economics, Université de Versailles, Saint-Quentin en Yvelines.

  David Evans is Director, Department of Health System Financing, Expenditure and Resource Allocation (FER), World Health Organisation.

  Michael Intriligator is Professor Emeritus of Economics, Political Science and Policy Studies, University of California, Los Angeles, and Senior Fellow, Milken Institute.

  Alan Manne (1925–2005) was Professor Emeritus of Opera-tions Research, Stanford University.

  Robert Mendelsohn is Edwin Weyerhaeuser Davis Professor, Professor of Economics, and Professor in the School of

  Management, Yale University.

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  x

  Contributors

  Arvind Panagaryia is Professor of Economics and Jagdish Bhagwati Professor of Indian Political Economy, Columbia

  University.

  Jan Pronk is Professor of International Development Policy, Institute of Social Studies, University of Amsterdam.

  Mark Rosenzweig is Mohamed Kamal Professor of Public Policy, at Kennedy School, Harvard University.

  Paul Schultz is Malcolm K. Brachman Professor of Economics, Department of Economics, Yale University.

  Peter Svedberg is Professor of Development Economics, The Institute for International Economic Studies, University of Stockholm.

  Jacques van der Gaag is Professor of Development Economics, University of Amsterdam.

  Ludger W ößmann is Head of the Department of Human Capital and Structural Change at the IFO Institute of Economic Research, University of Munich.

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  BJØRN LOMBORG1

  Introduction

  What Should We Do First?2

  Each day decisions are made about global political priori-

  ties. We choose to support some worthy causes while others are disregarded. Unfortunately, political decisions seldom take into account a comprehensive view of the effects and

  costs of solving one problem in relation to another. Priorities are often set in an obfuscated environment involving the conflicting demands of the media, the people, and politicians. Despite all good intentions, the decision-making process is marred by arbitrary and haphazard methods. The

  idea behind the Copenhagen Consensus is to render, in the

  future, this process less arbitrary, because political decisions should not be made arbitrarily, but should be based on facts and knowledge. The result stemming from the Copenhagen Consensus 2004 is very concrete: a ranked list of real challenges, for real people, in the real world.

  1 Director, Copenhagen Consensus Center / Copenhagen Business School.

  2 Translated by Gitanjali Kapila.

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  How to Spend $50 Billion to Make the World a Better Place If we had an extra $50 billion to put to good use, which

  problems would we solve first? That was the question put to the participants of the Copenhagen Consensus. Using more

  than 600 pages of scholarly papers as their point of departure, the participants engaged in an intense scholarly discussion that resulted in a set list of priorities regarding the world’s most challenging problems.

  This book constitutes a concrete contribution to the

  debate regarding global priorities – the question of how do we tackle the world’s problems, such as where should we

  start, and what should be done. The text adumbrates some

  of the world’s most pressing challenges, what can be done, how much it will cost, and what benefits will result. Armed with the information contained in these articles, readers

  will be in a better position to participate in the discussion of global priorities – and, in the spirit of the Copenhagen Consensus, to generate their own lists.

  The articles stem from the international conference, the

  Copenhagen Consensus, held in Copenhagen from the 24th

  to the 28th of May 2004, where 38 economists threw them-

  selves headlong into a debate – one that was both practical and theoretical – on how we can best solve the world’s greatest problems.

  The Copenhagen Consensus convened eight distin-

  guished economists, each of whom prepared an economics

  paper on serious global problems, from hunger and clean

  drinking water to disease and climate change. These

  eight researchers came to Copenhagen and presented

  their results. Additionally, twenty prominent researchers,

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  What Should We Do First?

  xiii

  engaged to argue against these results, also were in attendance. The expert panel included eight top economists,

  among them four Nobel laureates, whose task it was to lis-

  ten to all of the arguments, assess the ten areas of inquiry, and prioritize the solutions. This book contains summaries of the nine scholarly papers and rebuttals, all of which are written in language that is easy to understand.

  Why were all the experts economists? Many have ques-

  tioned this. The goal for the Copenhagen Consensus was to

  set priorities using the expertise of economists to set economic priorities. It seems clear that climate issues are best assessed by climate experts, and issues relating to malaria are best evaluated by malaria experts. If we asked a malaria expert or a climate expert to prioritize global warming or
communicable diseases as the most pressing global concern, it would not be difficult to imagine which issue each would find most important. As such, economists were the

  featured experts at the Copenhagen Consensus.

  The purpose of the Copenhagen Consensus was to build

  a bridge between the ivory tower of research and the general public. We need the rational calculations of economists in order to understand how we can best realize compassionate

  solutions that will make for a better world. Research should be utilized. Knowledge should be utilized. These facts were taken very seriously at the Copenhagen Consensus.

  The task assigned to the expert panel was not easy.

  They found that in some areas the information that was

  available – upon which they were to base their evaluations –

  was inadequate. This applied to education, armed conflict,

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  xiv

  How to Spend $50 Billion to Make the World a Better Place and financial instability. Another important result of the Copenhagen Consensus is that it is clear that there is a need for further research in these areas.

  This process is somewhat similar to the one being used

  by the UN’s Intergovernmental Panel on Climate Change.

  When the Panel first issued its report on the consequences of discharging greenhouse gases, it was evident that the report lacked critical information. This finding led to new research.

  When the Panel issued its second and third reports, many

  of the original lacunas in the first report were addressed.

  This process resulted in creating a better foundation for the decision-making process.

  That the task before us is difficult ought not to deter us from attempting it. That we don’t know everything should

  not keep us from using what we do know. The material

  available to the participants of the Copenhagen Consensus

  indicates that a fairly comprehensive knowledge base exists about a host of issues and their possible solutions.

  The top economists who participated in the Copenhagen

  Consensus exhibited a certain modesty vis- à-vis the difficult task before them. I want to emphasize that the expert panel was not bound in any way. The eight economists made all

  decisions, of course – and this, in itself, could be considered the crowning achievement of the Copenhagen Consensus.

  However, what is perhaps most surprising is that they were able to come to a consensus. The eight came to a surprising amount of agreement. The Experts Panel Ranking chapter