Economic analyses of global climate change have been criticized for their poor representation of climate change damages. Here we develop and apply aggregate damage functions in three economic Integrated Assessment Models (IAMs) with different degrees of complexity. The damage functions encompass a wide but still incomplete set of climate change impacts based on physical impact models. We show that with medium estimates for damage functions, global damages are in the range of 10% to 12% of GDP by 2100 in a baseline scenario with 3 °C temperature change, and about 2% in a well-below 2 °C scenario. These damages are much higher than previous estimates in benefit-cost studies, resulting in optimal temperatures below 2 °C with central estimates of damages and discount rates. Moreover, we find a benefit-cost ratio of 1.5 to 3.9, even without considering damages that could not be accounted for, such as biodiversity losses, health and tipping points.

New damage curves and multimodel analysis suggest lower optimal temperature / K. van der Wijst, F. Bosello, S. Dasgupta, L. Drouet, J. Emmerling, A. Hof, M. Leimbach, R. Parrado, F. Piontek, G. Standardi, D. van Vuuren. - In: NATURE CLIMATE CHANGE. - ISSN 1758-678X. - 13:5(2023 May), pp. 434-441. [10.1038/s41558-023-01636-1]

New damage curves and multimodel analysis suggest lower optimal temperature

F. Bosello
Secondo
;
G. Standardi
Penultimo
;
2023

Abstract

Economic analyses of global climate change have been criticized for their poor representation of climate change damages. Here we develop and apply aggregate damage functions in three economic Integrated Assessment Models (IAMs) with different degrees of complexity. The damage functions encompass a wide but still incomplete set of climate change impacts based on physical impact models. We show that with medium estimates for damage functions, global damages are in the range of 10% to 12% of GDP by 2100 in a baseline scenario with 3 °C temperature change, and about 2% in a well-below 2 °C scenario. These damages are much higher than previous estimates in benefit-cost studies, resulting in optimal temperatures below 2 °C with central estimates of damages and discount rates. Moreover, we find a benefit-cost ratio of 1.5 to 3.9, even without considering damages that could not be accounted for, such as biodiversity losses, health and tipping points.
Settore SECS-P/01 - Economia Politica
   Next generation of AdVanced InteGrated Assessment modelling to support climaTE policy making
   NAVIGATE
   European Commission
   Horizon 2020 Framework Programme
   821124
mag-2023
23-mar-2023
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/2434/1040194
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