William D. Nordhaus, Sterling Professor of Economics, Emeritus, whose influential work as an economist transformed a field and who won the 2018 Nobel Prize in Economics for his pioneering work on the economics of climate change, died on Oct. 30 following a battle with an aggressive brain cancer. He was 85.
Nordhaus was also a central figure on the Yale campus for more than 50 years, teaching generations of undergraduate and graduate students and holding key administrative roles for the university, including as provost and vice president for finance and administration.
His influential work ranged widely, from the economics of climate change to the measurement of technological change, the interaction of the business cycle and the election cycle, and the measurement of economic welfare - farsighted work done jointly with the late James Tobin, himself a Yale Nobel laureate and one of the most influential economists of his day.
Nordhaus is best known, however, for receiving the 2018 Nobel Prize for "integrating climate change into long-run macroeconomic analysis," an achievement most prominently reflected in what was known as the DICE (Dynamic Integrated Climate-Economy) model, an influential model that examines the interactions among carbon emissions, climate change, and economic growth.
The DICE model helps policymakers estimate the economic costs of climate change, including such impacts as crop losses and rising sea levels, and weigh them against the costs of reducing emissions. Nordhaus used the model to demonstrate that a carbon tax can reduce emissions efficiently and to estimate the optimal level of such a tax, providing an influential economic framework for carbon pricing.
"The signal contribution of economics," Nordhaus said in his Nobel speech, "is to recognize that climate change is a harmful unintended side effect of economic growth. The best remedy for such externalities is a pollution charge or what is now known as a carbon tax."
