Related papers: Baumol's Climate Disease
The fossil-fuel induced contribution to further warming over the 21st century will be determined largely by integrated CO2 emissions over time rather than the precise timing of the emissions, with a relation of near-proportionality between…
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…
In this paper, I consider a simple heterogeneous agents model of a production economy with uncertain climate change and examine constrained efficient carbon taxation. If there are frictionless, complete financial markets, the simple model…
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…
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…
A one-size-fits-all paradigm that only adapts the scale and immediate outcome of climate investment to economic circumstances will provide a short-lived, economically inadequate response to climate issues; given the limited resources…
Conventional economic analysis of stringent climate change mitigation policy generally concludes various levels of economic slowdown as a result of substantial spending on low carbon technology. Equilibrium economics however could not…
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…
There are many published estimates of the social cost of carbon. Some are clear outliers, the result of poorly constrained models. Percentile winsorizing is an option, but I here propose conceptual winsorizing: The social cost of carbon is…
Global warming from carbon dioxide (CO2) is known to depend on cumulative CO2 emissions. We introduce a model of global expenditures on limiting cumulative CO2 emissions, taking into account effects of decarbonization and rising global…
This paper tests the feasibility and estimates the cost of climate control through economic policies. It provides a toolbox for a statistical historical assessment of a Stochastic Integrated Model of Climate and the Economy, and its use in…
We provide a complete characterization of optimal extinction in a two-sector model of economic growth through three results, surprising in both their simplicity and intricacy. (i) When the discount factor is below a threshold identified by…
The unfolding climate crisis is a physical manifestation of the damage that market economy, driven by the high intensity consumption of fossil fuels, has inflicted on the Earth System and on the stability conditions that were established by…
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…
We study the implications of model uncertainty in a climate-economics framework with three types of capital: "dirty" capital that produces carbon emissions when used for production, "clean" capital that generates no emissions but is…
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…
Central to the official "green growth" discourse is the conjecture that absolute decoupling can be achieved with certain market instruments. This paper evaluates this claim focusing on the role of technology, while changes in GDP…
This paper outlines a critical gap in the assessment methodology used to estimate the macroeconomic costs and benefits of climate policy. It shows that the vast majority of models used for assessing climate policy use assumptions about the…
The United States has long pursued regulations that aim to reduce fossil fuel use. However, while potential emission reduction motivates the introduction and enforcement of these regulations, realization of this potential does not obfuscate…
The mitigation of climate change requires a fundamental transition of the energy system. Affordability, reliability and the reduction of greenhouse gas emissions constitute central but often conflicting targets for this energy transition.…