Priority for the Worse Off and the Social Cost of Carbon

Matthew Adler, David Anthoff (), Valentina Bosetti, Greg Garner, Klaus Keller and Nicolas Treich
Additional contact information
Matthew Adler: Duke University School of Law
Greg Garner: The Pennsylvania State University
Klaus Keller: The Pennsylvania State University and Carnegie Mellon University

No 2016.55, Working Papers from Fondazione Eni Enrico Mattei

Abstract: The social cost of carbon (SCC) is a monetary measure of the harms from carbon emission. Specifically, it is the reduction in current consumption that produces a loss in social welfare equivalent to that caused by the emission of a ton of CO2. The standard approach is to calculate the SCC using a discounted-utilitarian social welfare function (SWF)—one that simply adds up the well-being numbers (utilities) of individuals, as discounted by a weighting factor that decreases with time. The discounted-utilitarian SWF has been criticized both for ignoring the distribution of well-being, and for including an arbitrary preference for earlier generations. Here, we use a prioritarian SWF, with no time-discount factor, to calculate the SCC in the integrated assessment model RICE. Prioritarianism is a well-developed concept in ethics and theoretical welfare economics, but has been, thus far, little used in climate scholarship. The core idea is to give greater weight to well-being changes affecting worse off individuals. We find substantial differences between the discounted-utilitarian and non-discounted prioritarian SCC.

Keywords: Prioritarianism; Social Welfare Function; Social Cost of Carbon (search for similar items in EconPapers)
JEL-codes: I30 Q54 (search for similar items in EconPapers)
Date: 2016-08
New Economics Papers: this item is included in nep-agr, nep-ene, nep-env, nep-pke and nep-res
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Priority for the worse-off and the social cost of carbon (2017)
Working Paper: Priority for the Worse Off and the Social Cost of Carbon (2016)
Working Paper: Priority for the Worse Off and the Social Cost of Carbon (2016)
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