New damage curves and multimodel analysis suggest lower optimal temperature

Kaj-Ivar Wijst (), Francesco Bosello, Shouro Dasgupta, Laurent Drouet, Johannes Emmerling, Andries Hof, Marian Leimbach, Ramiro Parrado, Franziska Piontek, Gabriele Standardi and Detlef Vuuren
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Kaj-Ivar Wijst: PBL Netherlands Environmental Assessment Agency
Francesco Bosello: RFF-CMCC European Institute on Economics and the Environment (EIEE), Fondazione Centro Euro-Mediterraneo sui Cambiamenti Climatici
Laurent Drouet: RFF-CMCC European Institute on Economics and the Environment (EIEE), Fondazione Centro Euro-Mediterraneo sui Cambiamenti Climatici
Johannes Emmerling: RFF-CMCC European Institute on Economics and the Environment (EIEE), Fondazione Centro Euro-Mediterraneo sui Cambiamenti Climatici
Andries Hof: PBL Netherlands Environmental Assessment Agency
Marian Leimbach: Potsdam Institute for Climate Impact Research, Member of the Leibniz Association
Ramiro Parrado: RFF-CMCC European Institute on Economics and the Environment (EIEE), Fondazione Centro Euro-Mediterraneo sui Cambiamenti Climatici
Franziska Piontek: Potsdam Institute for Climate Impact Research, Member of the Leibniz Association
Detlef Vuuren: PBL Netherlands Environmental Assessment Agency

Nature Climate Change, 2023, vol. 13, issue 5, 434-441

Abstract: 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.

Date: 2023
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DOI: 10.1038/s41558-023-01636-1

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