What Social Cost of Carbon? A mapping of the Climate Debate

Baptiste Perrissin Fabert, Patrice Dumas and Jean-Charles Hourcade

No 128201, Climate Change and Sustainable Development from Fondazione Eni Enrico Mattei (FEEM)

Abstract: Given disparate beliefs about economic growth, technical change and damage caused by climate change, this paper starts with the seeming impossibility of determining a unique time profile of the social costs of carbon as a benchmark for climate negotiations and for infrastructure decisions that need to be made now in the absence of an inclusive international accord on climate policies. The paper demonstrates that determining a workable range of the social costs of carbon is however possible in a sequential decision-making framework that permits revising initial decisions in the light of new information. To do so, the paper exploits the results of a stochastic optimal control model run for more than 2000 scenarios that represent the set of beliefs presented about key uncertain parameters in the literature. The paper provides a heuristic mapping of the climate debate in the form of six “clubs of opinions” and shows the possibility of determining a range of social costs of carbon that might permit a compromise between the maximum range of “clubs” and those most likely to emerge in the future.

Keywords: Environmental; Economics; and; Policy (search for similar items in EconPapers)
Pages: 29
Date: 2012-05
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Citations: View citations in EconPapers (15)

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https://ageconsearch.umn.edu/record/128201/files/NDL2012-034.pdf (application/pdf)

Related works:
Working Paper: What Social Cost of Carbon? A Mapping of the Climate Debate (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:feemcl:128201

DOI: 10.22004/ag.econ.128201

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