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2019-08-30 | News

In memory of Martin Weitzman: 1942 - 2019

Marty Weitzman has left us.Marty made so many brilliant contributions to environmental economics that it does not feel like any exaggeration to honor him as the most creative and interesting of all our peers.

Marty spent a month here as visiting professor in Gothenburg in May. He gave the Tore Browaldh Lecture. He attended a research workshop I organized on climate economics and he talked to a number of graduate students and young researchers, sharing generously of his time and knowledge.

Personally I loved his style. There are other famous economists who breeze in to a lecture and say here is a difficult problem and Voila: here is my elegant solution. Marty would be much more humble: He would say that this problem is so hard, I have been thinking of various solutions but I don’t quite know how to solve it – and he would invite the audience to share his thoughts for an hour. It always felt like a privelige. It was great to have him here in Gothenburg for an extended visit and to share some private time on the coast.

My good friend Gernot was his student and no doubt his very youngest co-author and he has written such a great obituary that I will refer you to his text:

Thomas Sterner

 

 

Marty Weitzman, In Memoriam

By Gernot Wagner

There’s Weitzman (1979) that included both brilliant insights on optimal search theory and a brilliant reference to Greek mythology in form of “Pandora’s Problem.” There’s Weitzman (1976) and Weitzman (1998), spanning his work on green accounting and welfare. There’s Weitzman (1992) and Weitzman (1993), introducing set theory and economic thinking into species conservation. There’s Weitzman (2007), a brilliant new take on the equity risk premium puzzle that appears to have eluded financial economists for decades. That insight, in turn, led to Weitzman (2009) and Weitzman (2011) and Weitzman (2012), which introduce fat tails into the climate debate, something that had eluded climate economists. There’s Weitzman (2001), Weitzman (2010), and Weitzman (2012), sparking hundreds of papers and epic debates on how to think about discounting the distant future. There’s Weitzman (1984), followed by Weitzman (1985a) and Weitzman (1985b) and Weitzman (1985c), introducing the Share Economy, on how and why workers should partake in profit sharing, an idea a New York Times editorial called the “best idea since Keynes.” Then there’s Weitzman (1974), Prices vs. Quantities, the brilliant analysis of when to price versus when to limit emissions that launched the field of instrument choice, sparked policy debates the world over, and launched many an environmental economist’s career.

There are dozens more such papers, many offering brilliant insights to important problems, often using complex math to solve seemingly intractable problems, offering conclusions typically summarized in a simple equation or brilliantly chosen bon mot.

Then there’s Marty the teacher, person, and mensch. The kid from the Lower East Side who never did lose his New York accent. The person who, as a young professor in Cambridge, MA, bought a small, barren island in a marsh in Gloucester, MA, to build a refuge from academic life, a place where he taught himself Bayesian statistics in his sixties to write that equity risk premium puzzle paper, and where he went on a daily swim well into his seventies.

Weitzman was an academic’s academic, a theoretician’s theorist—someone who eschewed the trends in his discipline toward churning out ever more empirical analyses with larger and larger data sets and more and more coauthors. He appreciated and admired the efforts of those who did dive into thorny empirical questions with increasingly powerful computers. His preferred tools: a No. 2 pencil, a legal pad, and a hard wooden chair.

His study at the home he shared with his wife, Jennifer Bäverstam Weitzman, in Waban, MA, included just that. The laptop served mainly as a repository of papers and as a communications device. While Jennifer gave piano lessons in the living room, he focused on his next idea, playing his recorder whenever he felt his mind wander to refocus at the problem at hand.

It was this relentless focus on getting every model, every equation, every sentence just so that yielded some of the most consequential papers in all of environmental economics, his chosen field, and economics more broadly. Prices vs. Quantities began as a study of the Soviet economy, whether price or quantity controls yielded better results. The resulting paper attests to Weitzman’s intellectual nimbleness. His first submission was met with a rejection, and a reviewer’s comment that he might want to tackle a different set of questions, emerging in the early 1970s: whether to price or limit pollution. He recast the paper, his most cited work to date, and refocused a good part of his subsequent work on environmental problems and their solution.

While Weitzman the scholar loved to take on big intellectual problems, it was Marty the person who cared deeply about the world and how to improve society’s lot in it. Unapologetically focused on human well-being, he wrote some of the foundational papers on whether and how to account for natural resources and environmental quality, what has become known as “green accounting” or “green GDP.” Never shy to tackle difficult problems, he focused his final two decades almost exclusively on what he called a “wicked” problem: climate change. His focus: what science does not—perhaps cannot—know.

His work shows how it is precisely these unknowns and potentially unknowables that should lead to more of an emphasis on climate action now. Weitzman’s papers on discounting the far-distant future argue how uncertainty around the right rate should lead to declining discount rates over time: the farther out one goes, the lower the rate. His work on climate risks and uncertainties argues how it is precisely this tail risk that dwarfs all else. He termed the insight the “dismal theorem”—not because he liked the term, but because it brilliantly summarized the conclusion.

Weitzman had epic debates with some of his peers. With Christian Gollier, he debated the right way to think about the term structure of discount rates, culminating in one of his rare coauthored papers, Gollier and Weitzman (2010), once it became clear that both were looking at the same question from two different sides. With Bob Pindyck and Bill Nordhaus, he debated the implications of tail uncertainty and how to make sense of climate risk. In one of his most consequential policy-focused papers, he argued how the Stern Review on the Economics of Climate Change was “right for the wrong reasons.”

Weitzman the scholar will be remembered for many towering intellectual achievements. Marty the teacher, colleague, and friend will live on in our hearts, as generous with his time and devoted to making life better for all. Marty Weitzman the person would have loved nothing more than for his insights to rattle the status quo and to spark debates that will undoubtedly continue for years to come.