Stabilizing the global climate: A simple and robust benefit cost analysis

John Quiggin

No 152097, Risk and Sustainable Management Group Working Papers from University of Queensland, School of Economics

Abstract: Most models of optimal climate change policy are complex and opaque. In this paper, it is argued that the convexity of climate damage and mitigation cost function provides a basis for the derivation of simple and robust estimates of optimal stabilization targets and carbon prices. For all but a few extreme assumptions, the optimal carbon price is between $40 and $75. Similarly, for a wide range of parameter values the optimal target is between 425 ppm and 475 ppm. In all simulations, the total cost of mitigation is below 5 per cent of income, and in most cases substantially below.

Keywords: Environmental Economics and Policy; Resource/Energy Economics and Policy (search for similar items in EconPapers)
Pages: 27
Date: 2011
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Related works:
Journal Article: Stabilizing the Global Climate: A Simple and Robust Benefit-Cost Analysis (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:uqsers:152097

DOI: 10.22004/ag.econ.152097

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