EconPapers    
Economics at your fingertips  
 

GHG Targets as Insurance Against Catastrophic Climate Damages

Martin L. Weitzman

Scholarly Articles from Harvard University Department of Economics

Abstract: A critical issue in climate change economics is the specification of the so-called “damages function†and its interaction with the unknown uncertainty of catastrophic outcomes. This paper asks how much we might be misled by our economic assessment of climate change when we employ a conventional quadratic damages function and/or a thin-tailed probability distribution for extreme temperatures. The paper gives some numerical examples of the indirect value of various greenhouse gas (GHG) concentration targets as insurance against catastrophic climate change temperatures and damages. These numerical exercises suggest that we might be underestimating considerably the welfare losses from uncertainty by using a quadratic damages function and/or a thin-tailed temperature distribution. In these examples, the primary reason for keeping GHG levels down is to insure against high-temperature catastrophic climate risks.

Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (17) Track citations by RSS feed

Published in Journal of Public Economic Theory

Downloads: (external link)
http://dash.harvard.edu/bitstream/handle/1/11315435/GHG_Targets_Insurance.pdf (application/pdf)

Related works:
Journal Article: GHG Targets as Insurance Against Catastrophic Climate Damages (2012) Downloads
Working Paper: GHG Targets as Insurance Against Catastrophic Climate Damages (2010) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:hrv:faseco:11315435

Access Statistics for this paper

More papers in Scholarly Articles from Harvard University Department of Economics
Contact information at EDIRC.
Series data maintained by Ben Steinberg ().

 
Page updated 2014-10-27
Handle: RePEc:hrv:faseco:11315435