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Related papers: Social Cost of Carbon: What Do the Numbers Really …

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By its nature, the so-called social cost of carbon (SCC(t)) will likely not cover the cost induced by climate change (damage cost and abatement cost) if it is used as a CO$_2$-price. It is a marginal price only. We define an implied…

Mathematical Finance · Quantitative Finance 2024-01-30 Christian P. Fries

There is great uncertainty about future climate conditions and the appropriate policies for managing interactions between the climate and the economy. We develop a multidimensional computational model to examine how uncertainties and risks…

Economics · Quantitative Finance 2015-04-30 Yongyang Cai , Kenneth L. Judd , Thomas S. Lontzek

Integrated assessment models (IAMs) are valuable tools that consider the interactions between socioeconomic systems and the climate system. Decision-makers and policy analysts employ IAMs to calculate the marginalized monetary cost of…

Atmospheric and Oceanic Physics · Physics 2020-12-09 Kristina R. Colbert , Frank C. Errickson , David Anthoff , Chris E. Forest

The social cost of carbon (SCC) serves as a concise gauge of climate change's economic impact, often reported at the global and country level. SCC values are disproportionately high for less-developed, populous countries. Assessing the…

General Economics · Economics 2024-01-03 Francisco Estrada , Veronica Lupi , Wouter Botzen , Richard S. J. Tol

Integrated Assessment Models (IAMs) are mainstay tools for assessing the long-term interactions between climate and the economy and for deriving optimal policy responses in the form of carbon prices. IAMs have been criticized for…

General Finance · Quantitative Finance 2016-03-22 Sgouris Sgouridis , Abdulla Kaya , Denes Csala

To analyze climate change mitigation strategies, economists rely on simplified climate models - climate emulators. We propose a generic and transparent calibration and evaluation strategy for these climate emulators that is based on Coupled…

General Economics · Economics 2022-06-10 Doris Folini , Felix Kübler , Aleksandra Malova , Simon Scheidegger

Emissions pathways used in climate policy analysis are often derived from integrated assessment models. However, such emissions pathways do not typically include climate feedbacks on socioeconomic systems and by extension do not consider…

General Economics · Economics 2023-08-21 Christopher J. Smith , Alaa Al Khourdajie , Pu Yang , Doris Folini

The social cost of carbon is the damage avoided by slightly reducing carbon dioxide emissions. It is a measure of the desired intensity of climate policy. The social cost of carbon is highly uncertain because of the long and complex…

General Economics · Economics 2023-10-20 Richard S. J. Tol

Climate mitigation decisions today affect future generations, raising questions of intergenerational equity. Integrated assessment models (IAMs) rely on discounting to evaluate long-term policy costs and benefits. Using the DICE model, we…

Mathematical Finance · Quantitative Finance 2025-08-14 Christian P. Fries , Lennart Quante

Accounting for climate-related risks is an emerging problem for life insurers around the world. In this paper, we demonstrate how scenario trajectories for global temperature can be obtained using the cost-benefit Dynamic Integrated…

This paper presents a refined country-level integrated assessment model, FUND 3.9n, that extends the regional FUND 3.9 framework by incorporating sector-specific climate impact functions and parametric uncertainty analysis for 198…

General Economics · Economics 2025-09-05 In Chang Hwang , Richard S. J. Tol

We estimate the national social cost of carbon using a recent meta-analysis of the total impact of climate change and a standard integrated assessment model. The average social cost of carbon closely follows per capita income, the national…

General Economics · Economics 2026-01-21 Matthew K. Agrawala , Richard S. J. Tol

Assessing the costs of climate change is essential to finding efficient pathways for the transition to a net-zero emissions economy, which is necessary to stabilise global temperatures at any level. In evaluating the benefits and costs of…

Mathematical Finance · Quantitative Finance 2023-10-03 Christian Fries , Lennart Quante

We build a novel stochastic dynamic regional integrated assessment model (IAM) of the climate and economic system including a number of important climate science elements that are missing in most IAMs. These elements are spatial heat…

General Economics · Economics 2019-09-10 Yongyang Cai , William Brock , Anastasios Xepapadeas , Kenneth Judd

Carbon abatement decisions are usually based on the implausible assumption of constant social preference. This paper focuses on a specific case of market and non-market goods, and investigates the optimal climate policy when social…

General Economics · Economics 2023-12-19 Fangzhi Wang , Hua Liao , Richard S. J. Tol , Changjing Ji

We present an entirely new physics founded approach to estimating the social cost of carbon (SCC). For this, we developed our Ocean-Heat-Content Physics and Time Macro Economic Model (OPTiMEM) to estimate future heat content (separately…

Theoretical Economics · Economics 2026-02-27 Brian Hanley , Pieter Tans , Edward A. G. Schuur , Geoffrey Gardiner , Steve Keen , Adam Smith

Integrated Assessment Models (IAMs) of the climate and economy aim to analyze the impact and efficacy of policies that aim to control climate change, such as carbon taxes and subsidies. A major characteristic of IAMs is that their…

General Economics · Economics 2020-10-20 Yongyang Cai

A large database of published model results is used to estimate the distribution of the social cost of carbon as a function of the underlying assumptions. The literature on the social cost of carbon deviates in its assumptions from the…

Econometrics · Economics 2025-07-03 Richard S. J. Tol

A meta-analysis of published estimates shows that the social cost of carbon has increased as knowledge about climate change accumulates. Correcting for inflation and emission year and controlling for the discount rate, kernel density…

General Economics · Economics 2022-08-04 Richard S. J. Tol

Insufficient Social Cost of Carbon (SCC) estimation methods and short-term decision-making horizons have hindered the ability of carbon emitters to properly correct for the negative externalities of climate change, as well as the capacity…

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