Modeling the Impact of Warming in Climate Change Economics
Any economic analysis of climate change policy requires some model that describes the impact of warming on future GDP and consumption. Most integrated assessment models (IAMs) relate temperature to the level of real GDP and consumption, but there are theoretical and empirical reasons to expect tempe...
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| Format: | Working Paper |
| Language: | en_US |
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MIT Center for Energy and Environmental Policy Research
2010
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| Online Access: | http://hdl.handle.net/1721.1/51719 |
| _version_ | 1811076639086346240 |
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| author | Pindyck, Robert S. |
| author_facet | Pindyck, Robert S. |
| author_sort | Pindyck, Robert S. |
| collection | MIT |
| description | Any economic analysis of climate change policy requires some model that describes the impact of warming on future GDP and consumption. Most integrated assessment models (IAMs) relate temperature to the level of real GDP and consumption, but there are theoretical and empirical reasons to expect temperature to affect the growth rate rather than level of GDP. Does this distinction matter in terms of implications for policy? And how does the answer depend on the nature and extent of uncertainty over future temperature change and its impact? I address these questions by estimating the fraction of consumption society would be willing to sacrifice to limit future increases in temperature, using probability distributions for temperature and impact inferred from studies assembled by the IPCC, and comparing estimates based on a direct versus growth rate impact of temperature on GDP. |
| first_indexed | 2024-09-23T10:25:16Z |
| format | Working Paper |
| id | mit-1721.1/51719 |
| institution | Massachusetts Institute of Technology |
| language | en_US |
| last_indexed | 2024-09-23T10:25:16Z |
| publishDate | 2010 |
| publisher | MIT Center for Energy and Environmental Policy Research |
| record_format | dspace |
| spelling | mit-1721.1/517192019-04-10T16:55:10Z Modeling the Impact of Warming in Climate Change Economics Pindyck, Robert S. Any economic analysis of climate change policy requires some model that describes the impact of warming on future GDP and consumption. Most integrated assessment models (IAMs) relate temperature to the level of real GDP and consumption, but there are theoretical and empirical reasons to expect temperature to affect the growth rate rather than level of GDP. Does this distinction matter in terms of implications for policy? And how does the answer depend on the nature and extent of uncertainty over future temperature change and its impact? I address these questions by estimating the fraction of consumption society would be willing to sacrifice to limit future increases in temperature, using probability distributions for temperature and impact inferred from studies assembled by the IPCC, and comparing estimates based on a direct versus growth rate impact of temperature on GDP. Massachusetts Institute of Technology. Center for Energy and Environmental Policy Research. 2010-02-11T18:06:12Z 2010-02-11T18:06:12Z 2010-01 Working Paper 2010-001 http://hdl.handle.net/1721.1/51719 en_US MIT-CEEPR (Series);2010-001 application/pdf MIT Center for Energy and Environmental Policy Research |
| spellingShingle | Pindyck, Robert S. Modeling the Impact of Warming in Climate Change Economics |
| title | Modeling the Impact of Warming in Climate Change Economics |
| title_full | Modeling the Impact of Warming in Climate Change Economics |
| title_fullStr | Modeling the Impact of Warming in Climate Change Economics |
| title_full_unstemmed | Modeling the Impact of Warming in Climate Change Economics |
| title_short | Modeling the Impact of Warming in Climate Change Economics |
| title_sort | modeling the impact of warming in climate change economics |
| url | http://hdl.handle.net/1721.1/51719 |
| work_keys_str_mv | AT pindyckroberts modelingtheimpactofwarminginclimatechangeeconomics |