World Temperature-Trend Uncertainties and Their Implications for Economic Policy

Three data sets on world temperature are studied. Data on direct measurements of world temperature over the past century yield trend estimates of .45 degrees Celsius per century with rather wide confidence intervals of (.15, .75). The data's behavior raises questions about whether the trend is genuine or due to greenhouse-gas emissions. Data on temperature measurements inferred from tree rings over the past 1,500 years display no trend. The upward drift over the past century could easily be a cyclical upswing of the type that has occurred many times in the past.