OEA World Environment Day Talk – Subhrendu K Pattanayak

The world faces a clear and present planetary health crisis, exemplified by the worsening air pollution (ambient & indoor) in S. Asia. Economists have entered this fray with better data, careful methods & more rigor. In principle, at least, economists can treat implementation of policies (to deal with this crisis) as a science, specifying and testing hypotheses regarding policy implementation, which is often the Achilles heel of good ideas. Economists draw attention to preferences & constraints faced by households (and firms, governments, NGOs) using rigorous quantitative approaches. We illustrate this approach with a multiyear multi-stage experimental study in the Himalayas to promote electric cooking. What we must remember is that policies impose many costs and benefits (political economy, transaction costs). Thus, economists must avoid the rising risks of type III errors (precise answers to pointless questions), if they want to aid policy implementation.