Global warming policy has become the world’s most expensive bet. Governments have committed trillions of dollars on the assumption that carbon dioxide (CO2) from human activity is the principal driver of rising temperatures.
The story is simple: more CO2 in the air means higher global temperature. That simplicity proved politically convincing and underpins net‑zero targets, carbon pricing, and vast subsidies to decarbonize industry, energy, and transport within a generation.
But what if that core relationship is statistically less solid than advertised?
My new paper, published in the journal Science of Climate Change, probes that possibility with a disarmingly basic question: “Could CO2 be the principal cause of global warming?”
Instead of turning to climate models, I used my financial research experience to approach the problem the way economic analysts examine a market hypothesis: by testing how well data supports the assumed cause and effect.
This approach offers promise because climate and financial markets have a lot in common. Both are complex global systems with many feedbacks, incomplete data, and multiple plausible drivers. Both rely heavily on time‑series data, where establishing causality is notoriously difficult.
In finance, skeptical regulators and risk managers insist that models be stress‑tested against hard numbers. My analysis applied that toolkit to the CO2-temperature link to provide what Nobel laureate Daniel Kahneman recommended as an outside view.
The starting point is familiar. Since the 19th century, atmospheric CO2 and global average temperature have both trended upward. This co-movement is widely taken as empirical support for a mechanistic link from CO2 to temperature.
But as economists have known for decades, two variables that rise together can look tightly correlated even if they are not directly related at all. Although ice cream sales and shark attacks both increase in summer, that doesn’t mean one causes the other.
To guard against this trap, econometricians test whether correlations persist once time trends are removed. This is done by looking at correlations between year‑to‑year changes as well as levels: does each annual uptick in CO2 produce a corresponding nudge in the global temperature?
Since reliable data became available around 1960, annual increases in atmospheric CO2 have accelerated markedly, while the annual rate of warming has stayed roughly constant.
If CO2 were the main driver and had a linear influence, the pace of warming should have sped up in step. It has not.
On this basis, the headline correlation between CO2 levels and temperature is likely spurious, driven largely by the fact that both happen to trend upward over time.
Causality is the next hurdle. For CO2 to be the principal driver of warming, changes in CO2 should consistently lead temperature changes, not the other way round.
Simple regressions confirm that levels of CO2 and temperature move together, but without a clear lead‑lag pattern. Shifting to changes, temperature does not reliably follow earlier movements in CO2, and actually leads subsequent changes in CO2.
Because robustness is crucial, the exercise is repeated using multiple temperature datasets (HadCRUT5, NASA GISS) and CO2 records (Mauna Loa, Barrow, Cape Grim).
The pattern persists: CO2 and temperature levels co‑rise, but once you look at annual changes and timing, the simple story of CO2 driving temperature falls apart.
If CO2 is not significantly contributing to global warming, then what is? While no alternative climate model was presented, three variables were identified as having a strong statistical correlation with temperature: the Atlantic Multidecadal Oscillation (a long-lived pattern in North Atlantic sea surface temperatures), global cereal production, and atmospheric humidity.
Regression of temperature against these variables, using both levels and year-to-year changes, reveals strong linear relationships that withstand the standard statistical tests. Humidity stands out as a particularly powerful factor, accounting for a significant portion of temperature variation and consistently leading the data.
This analysis is not the first to raise these statistical concerns and builds on earlier work in climate econometrics. What is striking is how little weight such work has had in policy debates compared with physics‑based models that are calibrated on the very data they seek to explain.
In other fields, relying almost entirely on internally tuned models, with limited independent empirical challenge, would be seen as a recipe for groupthink.
The critical conclusion of this analysis is that the central claim of climate science – that global warming is driven in a near‑linear relationship by cumulative CO2 – does not survive basic statistical scrutiny using historical data.
This matters for climate policy because current strategies are effectively an all-or-nothing bet on that relationship being right.
Finance recognizes this as classic model risk. When a model underpins trillion-dollar exposures, good governance demands independent validation, stress testing, and transparency about uncertainties. Climate policy deserves no less.
A prudent approach would treat the dominant CO2 story as a leading theory, not a closed case, and design policy around that uncertainty. It would put more weight on adaptation, energy resilience, and practical measures that still pay off even if CO2 proves less influential than advertised.
It is politically tempting to dismiss uncomfortable analyses as heresy. But genuine risk management values challenge.
When a finance researcher can take public climate data, apply standard tools, and cast doubt on the central plank of global climate policy, decision-makers should not look away.
They should be asking the question posed by this article, and demand that climate models and policies alike be built on relationships that have been tested and retested against the real world.
Les Coleman trained as an engineer and worked for 25 years with mining and oil companies on three continents in operations, planning, and finance roles. He then completed a PhD on corporate risk management and spent 20 years as an academic. Much of his research involved interviews with corporate executives on decision-making. He then published a critique of the conventional scientific method as Research in Crisis: Blueprint to overhaul the knowledge factory (Routledge, London, 2021) and now uses his rich background to conduct multidisciplinary studies on policy-related scientific questions such as climate change.
There have been two warming periods in the 20th century; one from 1910-1940, and the other from 1978 – 1998. Between these two warming periods was an abrupt cooling period from 1950 – 1975 despite significant increases in CO2 emissions after WW2.. This should have been a clue to everyone, scientists alike, that something much more powerful than carbon dioxide suddenly cooled the planet for 25 years. Then after 1998 the increase in global temperature stalled for 17 years, once again despite massive amounts of increased CO2 into the atmosphere during this time. Will Happer professor emeritus from Princeton University and William van Wijngaarden from York University conducted a study on greenhouse gasses and found that H2O, CO2, CH4, N2O and O3 are all saturated in the atmosphere. Water Vapour and Carbon dioxide are nearly totally saturated in the atmosphere so this suggests that future increases in CO2 emissions will not result in any existential threat to the planet. Happer stated that per molecule CO2 is attenuated by four orders of magnitude, thus further increases in CO2 emissions should have a continually less effect per volume of CO2. Then there is Urban Heat Island Effect that is falsely increasing the temperature measurement data from weather stations that were initially installed in fields outside cities but are now inside cities due to urban sprawl and thus weather data are adversely affected by heat radiating from concrete, pavement, brick buildings and air conditioning exhaust. In Willy Soon’s study in 2023, he concluded that he couldn’t find any trace of warming by CO2, so the 1.0 degree C of warming during the last century was due to mostly two causes; the sun’s variability and Urban Heat Island Effect. In the recent video presentation, Climate; the Movie, ( The Cold Truth) all of, some of the the most revered scientists in the world, that discussed climate change issue in this video, stated that CO2 has never been responsible for the warming of the earth. In other words there are many other more powerful sources responsible for warming and cooling our planet; the sun, ocean currents .. EL Nino, PDO, AMO, clouds, under sea and land volcanic eruptions and venting and now cosmic radiation through studies by Henrich Svensmark and Nir Shaviv. All of this suggests that atmospheric CO2 is a minor player in generating heat on the planet. However this is not what we hear from Governments and mainstream media daily which is due mostly, I believe, to the Summary for Policy Makers, a report sent to governments and mainstream media , part of the Assessment Review process, by the UNIPCC who use the worst case scenario, RCP 8.5, from the Representative Concentration Pathways computer models to enhance their agenda. Computer models aren’t data, nor are they evidence, but the popular CO2 hoax manufactured by the UN and now the WEF are the result of fear mongering agendas which further their goals for world governance. They even admit this. Years ago Christiana Figueres, the former Executive Secretary of the UNFCCC, stated that the UN wanted to change the economic system of the world that had been used for past 150 years; she was talking about capitalism. The UN doesn’t like capitalism which is synonymous with democracy, freedom and prosperity. Their goals of global governance are thus a threat to our freedom and prosperity in all democratic countries.
“Since reliable data became available around 1960, annual increases in atmospheric CO2 have accelerated markedly, while the annual rate of warming has stayed roughly constant.”
starting in nineteen seventy five, based on ten year averages, both average global temperature and CO2 emissions have been rising and accelerating. the author is rewriting history and obviously has no knowledge of the data. he also does not recognize the difference between CO2 as a climate feedback and CO2 as a climate forcing.
this is an author who should not be writing about climate science and should not be published in a climate science website
There’s no acceleration of temperature so your statement is nonsense.
10 year totals (1975 to 1985, 1985 to 1995, 1995 to 2005, etc )
have been accelerating.
The rate of warming has increased dramatically in recent years. While the planet has warmed by about 0.06°C (0.11°F) per decade since 1850, that rate has more than tripled in recent decades.
Decadal Shift:
Since 1982, the warming rate has risen to 0.20°C (0.36°F) per decade according to NOAA.
Recent Surge:
Scientists have observed a “decisive shift” in the last few years. Average temperatures over the past decade increased by nearly 0.27°C per decade, a 42% jump from the 1970–2010 average
you live in the fantasyland of data denial
What you say is utter BS and you live in some fantasy world that doesn’t exist. Your “data” is totally made up.
Picking 1975 as a start date is cheery picking the data. The year 1975 was at the end of a 35 year cooling trend. That year they were worried that a new ice age was starting. Anything in comparison is going to be warmer. The year 1985 was also a cool year.
According to UAH satellite based data of the global lower atmosphere between 1983 and 2023, the earth is warming at 0.15 degrees C per decade.