Martin Weitzman, an inventive economist who argued that governments would see climate change as a more urgent matter to address if they took more seriously the small but real risks of the most catastrophic of outcomes, died Aug. 27 in Newton, Mass. He was 77.
The Massachusetts medical examiner’s office said it was investigating the death as a suicide as it awaited the results of laboratory tests. Colleagues said Dr. Weitzman had grown increasingly despondent after being passed over for the Nobel Prize in economics last year and had left a note questioning whether he could contribute to his field any further.
Most economists have relied on a cost-benefit analysis when considering how ambitiously governments might try to reduce heat-trapping carbon emissions, either by imposing caps on how much can be emitted or by taxing the polluters.
But Dr. Weitzman demonstrated that such prevailing cost-benefit analyses understated the small but nevertheless credible risks that worst-case environmental damage posed to the world and its economy, from its agricultural production to its delivery of goods and services. Were governments to take these catastrophic scenarios into account more seriously, he said, they would be more vigorous in their efforts to slow or even reverse global warming.
Robert Stavins, director of the environmental economics program at the Harvard Kennedy School and an author of international reports on climate change, said Dr. Weitzman had “developed very strong arguments of why – when analyzing the benefits and costs of proposed climate policies – it was essential, from an economic perspective, to take into account the possibility of catastrophic outcomes, despite the fact that their probability might be relatively small.”
In Climate Shock: The Economic Consequences of a Hotter Planet (2015), Dr. Weitzman and his co-author, Gernot Wagner, an economist at New York University, wrote: “One thing we know for sure is that a greater than 10 percent chance of the earth’s eventual warming of 11 degrees Fahrenheit or more – the end of the human adventure on this planet as we now know it – is too high. And that’s the path the planet is on at the moment."
“Most everything we know tells us climate change is bad,” the authors concluded. “Most everything we don’t know tells us it’s probably much worse.”
His analysis of the economics of climate change became known as the Dismal Theorem.
In an earlier influential paper, written in 1974, Dr. Weitzman questioned the conventional view among economists that taxing pollutants was a more effective way to curb them than setting limits on how much pollution could be generated.
He argued that each approach created its own ambiguities: Levying a tax makes it easy to predict the cost of the policy, but not how much companies will continue to pollute. Imposing a cap makes the amount of pollution quantifiable, but not the cost.
His analysis helped lay the groundwork for what is commonly known as the cap-and-trade alternative, which imposes a ceiling on pollutants but lets companies set the price in the marketplace by trading permits to pollute within those caps. Cap-and-trade programs have helped reduce acid rain pollution in the United States and are being used to tackle climate change in California and the European Union.
Dr. Weitzman addressed another broad economic challenge in his book The Share Economy: Conquering Stagflation (1984), in which he proposed that the crippling nexus between unemployment and inflation could be severed by means of profit-sharing; in other words, by linking a substantial portion of workers’ income to a company’s revenue instead of paying a fixed wage.
“He thought of the question, not just the answer,” Dr. Stavins said, “and that requires a real spark of brilliance, combined with his desire to address pressing real-world environmental problems.”
Dr. Weitzman was honoured at a symposium at Harvard’s Kennedy School last October as he retired to take the title of research professor. The occasion was bittersweet: It came three days after the announcement of the 2018 Nobel Prize in economics, which he and many colleagues thought he would win.
The prize went to two other economists, Paul Romer, of New York University, and William Nordhaus, an economics professor at Yale. Dr. Nordaus was cited for his own advances in environmental economics.
Dr. Nordhaus delivered the keynote speech at the Harvard symposium, in which he praised Dr. Weitzman for his “radically innovative spirit” in, among other things, positing his Dismal Theorem; assessing the negative effect of pollution on the gross national product; and underscoring the positive effects that gains in health care and education have on the gross national product.
“Marty Weitzman was the pre-eminent environmental economist of the modern era, which is to say of all times,” Dr. Nordhaus said this week.
Colleagues said that Dr. Weitzman had been despondent after he did not win the Nobel and that his mental state worsened in the spring, when, for the first time in his career, a fellow economist pointed out a mistake in a completed but unpublished paper he had circulated.
In a typewritten note that was found after his death, Dr. Weitzman said his capacity to solve the kinds of difficult problems to which he had devoted his career was diminishing.
He was born Meyer Levinger on April 1, 1942, on the Lower East Side of Manhattan to Joseph and Helen (Tobias) Levenger. His mother died before he was 1; his father, after returning from military service in the Second World War, was apparently unable to care for the child, and he was placed in an orphanage. His adoptive parents, Samuel and Fannie (Katzelnick) Weitzman, who were elementary-school teachers, gave him the name Martin Lawrence Weitzman.
After completing high school in Levittown, N.Y., he attended Swarthmore College in Pennsylvania, where he majored in math and physics, graduating in 1963. He earned a master’s degree in statistics and operations research at Stanford and a doctorate in economics at the Massachusetts Institute of Technology.
He married Jennifer Brown Baverstam, a piano teacher and translator. He leaves Ms. Baverstam along with a daughter, Rodica Weitzman, from his marriage to Dorothy Early, which ended in divorce; his stepchildren, Kristian, Madeleine, Sebastian and Oliver Baverstam; and two grandchildren.
Dr. Weitzman taught at Yale, where he began his teaching career in 1967, and MIT before joining the Harvard faculty in 1989. Since 1992, he and Dr. Stavins conducted nearly 400 sessions of the Harvard Seminar in Environmental Economics and Policy.
At one point, from a barren island he bought off the coast of Gloucester, Mass., Dr. Weitzman spent a year or more immersing himself in Bayesian statistics, which focuses on probability.
Comparing the approaches of Dr. Weitzman and Dr. Nordhaus, Dr. Wagner of NYU said, “Bill Nordhaus’s model has famously focused on what’s known, what economists can quantify,” such as the costs versus the benefits of shifting away from fossil fuels, or the efficacy of taxing carbon emissions versus imposing a cap-and-trade system.
“Marty,” he said, “focused on what we don’t know, can’t quantify, and how that might change the final outcome.”
After he was told that he had won the Nobel, Dr. Nordhaus said he had been surprised to learn that he would be sharing it with Dr. Romer. “I figured,” he told colleagues at Yale, “it would be a former colleague here, Martin Weitzman, who is an extraordinarily brilliant guy.”