Growth and adaptation to climate change in the long run
Simon Dietz and
No 19-09, IRENE Working Papers from IRENE Institute of Economic Research
As the climate is changing, the global economy is adapting. We provide a novel method of estimating how much and how much it has cost, based on a structurally estimated, global model of long-run growth. Agriculture is key because it is vulnerable to climate change and food cannot be perfectly substituted. Structural change out of agriculture has been slowed by climate change because more resources have compensated for declining yields. The model can also estimate optimal future carbon taxation. Adaptation is costly, so large emissions cuts could improve welfare substantially. Uncertainty about climate damages in agriculture strongly affects optimal policy.
Keywords: agriculture; climate change; directed technical change; economic growth; energy; population growth; structural change; structural estimation; uncertainty (search for similar items in EconPapers)
JEL-codes: C51 O13 O44 Q54 (search for similar items in EconPapers)
Pages: 51 pages.
New Economics Papers: this item is included in nep-agr, nep-env and nep-gro
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Working Paper: Growth and Adaptation to Climate Change in the Long Run (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:irn:wpaper:19-09
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