Challenges and innovations in the economic evaluation of the risks of climate change

James A. Rising, Charlotte Taylor, Matthew C. Ives and Robert E.t. Ward

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: A large discrepancy exists between the dire impacts that most natural scientists project we could face from climate change and the modest estimates of damages calculated by mainstream economists. Economic assessments of climate change risks are intended to be comprehensive, covering the full range of physical impacts and their associated market and non-market costs, considering the greater vulnerability of poor people and the challenges of adaptation. Available estimates still fall significantly short of this goal, but alternative approaches that have been proposed attempt to address these gaps. This review seeks to provide a common basis for natural scientists, social scientists, and modellers to understand the research challenges involved in evaluating the economic risks of climate change. Focusing on the estimation processes embedded in economic integrated assessment models and the concerns raised in the literature, we summarise the frontiers of research relevant to improving quantitative damage estimates, representing the full complexity of the associated systems, and evaluating the impact of the various economic assumptions used to manage this complexity.

Keywords: review; climate impacts; integrated assessment; economic modelling; social cost; research frontier; ES/R009708/1; rantham Research Institute on Climate Change and the Environment; at the London School of Economics; and the ESRC Centre for Climate Change Economics and Policy (CCCEP; UKRI block grant (search for similar items in EconPapers)
JEL-codes: J01 N0 R14 (search for similar items in EconPapers)
Pages: 13 pages
Date: 2022-07-01
New Economics Papers: this item is included in nep-agr, nep-ene, nep-env and nep-his
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Published in Ecological Economics, 1, July, 2022, 197. ISSN: 0921-8009

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