The UnAustralian

Wednesday, June 02, 2004
More on Castles and Henderson

Long time readers of this blog will be aware that the criticisms of the economic modeling of the IPCC's various scenarios by Ian Castles and David Henderson have been covered a number of times. Now, a (peer reviewed, incidentally) article has appeared (or more precisely, a preprint has appeared on the journal's website) in Climatic Change by Bjart Holtsmark and Knut Alfsen of Statistics Norway (PPP Correction of the IPCC Emission Scenarios - Does It Matter?).

The authors point out that while using market exchange rates does increase the income differences between rich and poor countries, this increase is effectively neutralised because the same market exchange rates also overstate the emission-intensity gap.

What this boils down to is this; market exchange rates aren't a good indicator when comparing standards of living in different countries, however, this doesn't make a difference to the economic modeling used by the IPCC.

Of course, this hasn't stopped people, such as Alan Wood (economics editor of The Australian) taking everything which Castles and Henderson produce as gospel.
| 7:09 PM