Nicholas Stern (Hammersmith, United Kingdom; 1946) is currently I. G. Patel Professor of Economics and Government at the London School of Economics and Political Science. He also heads the India Observatory within the Asia Research Centre and the Grantham Research Institute on Climate Change. In 2010, he was appointed a professor in the Collège de France. Among the posts he has held are that of Head of the Government Economic Service in the United Kingdom and Chief Economist at the European Bank for Reconstruction and Development. Knighted in 2004 for his “services to the economy,” he was appointed to Britain’s House of Lords in 2007. He has been President of the British Academy since 2013, and the following year was elected a Fellow of the Royal Society.
He has worked at higher education institutions all round the world, including Oxford and Warwick universities (United Kingdom), Massachusetts Institute of Technology (United States), École Polytechnique (France), the Indian Statistical institute and the People’s University of China. Between 2000 and 2003, Stern was Chief Economist and Senior VicePresident of the World Bank. He then served as Second Permanent Secretary at HM Treasury and as Director of Policy and Research for the UK’s Commission for Africa. It was during this time that he was appointed to head the study on the economics of climate change written up as the Stern Review.
Author of 21 books and some 120 papers and book chapters, he was editor of the Journal of Public Economics from 1981 to 1998, and has held editorial posts at six other leading journals in the economics and development area. He has also served on numerous committees for organizations like OXFAM, the Royal Economic Society, the International Food Policy Research Institute, the Nelson Mandela Legacy Trust and the European Commission. Stern has received the Blue Planet Prize (2009), the Leontief Prize (2010), and the Schumpeter Award (2015).
Speech
Climate Change, 3rd edition
“If our goal is to live in a world without poverty, we must take action to empower poor people to participate in economic growth.”
“If our goal is to live in a world without poverty, we must take action to empower poor people to participate in economic growth.”
TUITEAR
The author of this quote is an expert in development economics, whose research has taken him to a town of 100,000 people in the north of India, and various parts of Africa. Among the posts he has held are that of Chief Economist with the World Bank, Head of the Government Economic Service in the United Kingdom and Chief Economist at the European Bank for Reconstruction and Development.
But his renown dates from his incursion into a field that was till then a terra incognita for economics: the field of climate change. In the process, Nicholas Stern, BBVA Foundation Frontiers of Knowledge laureate in the Climate Change category, built the first solid bridge between two of the great challenges facing humanity in this 21st century: global development and the alteration of the world’s climate.
Stern, IG Patel Professor of Economics and Government at the London School of Economics and Political Science (LSE), in the United Kingdom, is first author of “The Economics of Climate Change: The Stern Review,” a report which “focused the discourse on the economics of climate change” and “fundamentally changed the international debate” in this arena, in the words of the Frontiers of Knowledge jury. The “advanced economic analysis” applied by Stern has been the means to “quantify the impacts and costs arising from the alteration of our planet’s climate,” while providing “a unique and robust basis for decision-making.”
The Stern Review, commissioned by the British government and published in 2006, concludes that failure to tackle climate change will exact a far higher economic cost than acting now to reduce greenhouse gas emissions. On its estimate, world economic growth will contract by between 5 and 20 percent if greenhouse gas emissions continue at their current levels, while the switch to a low-emissions economy would cost around one percent of global GDP each year. The message is compelling: “By acting now we can avoid major disruption further ahead,” says Stern.
The worldwide impact of its analysis has tended to overshadow Nicholas Stern’s earlier achievements. The report, however, is not a one-off, but the crowning point of a long career devoted to promoting global development.
Stern was born in Hammersmith, United Kingdom in 1946. His father, a German Jew, had emigrated to Britain in 1938 following the “Night of the Broken Glass.” Stern grew up in the town of Brentford, in west London – hence his decision to take the title Baron Stern of Brentford on receiving his life peerage in 2007. He studied mathematics at Cambridge and Oxford for no other reason than “because I enjoyed it.” But economics was never very far away: “I was also becoming more and more interested in economic policy as a result of growing up in a political family and traveling in my teens and early twenties in very poor countries.”
His first teaching posts were at the universities of Oxford and Warwick. And it was there he began one of the research projects that would most influence his future career; a study on the economic development of the town of Palanpur, in northern India. “I lived there for around eight months in 1974 and 1975, and have been following it closely ever since,” he relates. “For me, watching how Palanpur has changed over nearly forty years has been a huge part of my education and has really shaped my perspective on things.”
Palanpur’s economy had already been the subject of research in the 1950s and 1960s. And Stern and his colleagues took up the baton with their careful observation of the lives of farmers, and rigorous analysis of local production, consumption and markets. The team continued their fieldwork in the area through the 1980s and 1990s, and published various books that are now considered a milestone in the application of micro-statistics to the economics of the developing world. Stern continues to follow events in the town, which he visits regularly. Asked why he chose this part of the world, his answer is immediate: “India and Africa have the biggest concentrations of poverty in the world. They are also very vibrant and exciting societies and cultures.”
In 1986, he took up a professorship at the LSE. His subsequent career in policy began in 1994 as Chief Economist at the European Bank for Reconstruction and Development, created to promote private and entrepreneurial initiative in the former communist countries of Europe and Asia. In 2000, Stern moved to the World Bank where he took up the Chief Economist post vacated by the Nobel economics laureate Joseph Stiglitz, whom he had previously encountered while researching on tea plantations in Kenya. Stiglitz currently shares Stern’s thinking on the issue of climate change.
In 2003, he became Second Permanent Secretary of Her Majesty’s Treasury, at the helm of the British government’s fiscal and economic policy, and Head of the Government Economic Service. It was during this time that he was appointed to lead the study on climate change economics that would turn into the Stern Review.
After the Review’s publication, its author resumed his professorial duties at the LSE, his “intellectual home,” and currently chairs this institution’s Asia Research Centre and Grantham Research Institute on Climate Change and the Environment. Knighted in 2004 for his “services to the economy,” he was appointed to Britain’s House of Lords in 2007, and in 2010 was awarded a professorship in the Collège de France.
Known for his diplomatic skills, Stern is nonetheless unswerving in his views on climate change. “We live where we live because of patterns of climate, where the rivers are, where the seashores are. What we’re talking about here – the cost of inaction – is a transformation of where we can be. We are at serious risk of suffering a global war in the next 100 or 120 years, because there will be hundreds of millions of people, perhaps billions of people moving around,” he warns. “We have never before seen a displacement of people on this scale.”
Not only that,“the consequences of climate change are arriving faster than we expected.”
“The consequences of climate change are arriving faster than we expected.”
TUITEAR
So is this a defeat? On the contrary, Stern responds, we must see it as a challenge. “Fighting climate change calls for investment, certainly, but it is also a major economic opportunity. Indeed climate change economics is the next industrial revolution. The countries who invest now in this new growth market will gain the advantage of a first mover. Those who don’t risk being left behind.”
