The Pie: An Economics Podcast An Extra Slice of the Pie: Choosing with Uncertainty
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May 1, 2025 
Lars Peter Hansen, a Nobel Prize-winning economist and expert in uncertainty, dives into the complexities of decision-making amidst unpredictability. He discusses how policymakers can navigate uncertainty and the implications of declining public trust in scientific authority. The conversation explores the balance required in climate change decisions, weighing immediate action against the need for more information. Hansen also reflects on the importance of transparent communication in science to enhance public confidence and improve decision-making in challenging contexts.
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Hansen's Troubling High School Experience
- Lars Peter Hansen shared a high school story where his teacher supported shooting protesters, which clashed with his views.
- This event triggered a strained relationship, illustrating personal conflict during the Vietnam War era.
Uncertainty and Public Trust
- Excessive scientific confidence can erode public trust, especially when experts disagree.
- Communicating uncertainty clearly is key to maintaining credibility and encouraging informed policy decisions.
Data Needs Frameworks
- Data never speaks for itself; conceptual frameworks are essential for interpreting evidence in policy.
- Combining evidence with conceptual understanding helps address complex issues like climate change effectively.