Rational Climate Skeptics

Book excerpt: This paper presents a game-theoretical approach to climate change skeptics. The credibility gap between the scientist and the government is created if the preference of the scientist is not perfectly aligned with that of the government. The credibility gap is eliminated and the ex-ante social welfare is maximized if and only if the scientist's preference is perfectly aligned with that of the government, not with that of the median voter. This is endogenously achieved when the government is allowed to appoint its optimal scientist without election concerns. In the case where the government has election concerns, if the median voter perceives an alarming message from the scientist, then even a “right-wing” government must choose an aggressive climate change policy to avoid losing the election. Accordingly, it will prefer to appoint a scientist who is unlikely to send an alarming message. Thus the government deliberately creates a credibility gap which may cause a distorted climate change policy in a democracy.