Climate Sensitivity Uncertainty: When is Good News Bad?

Mark C. Freeman, Gernot Wagner and Richard Zeckhauser

No 20900, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Climate change is real and dangerous. Exactly how bad it will get, however, is uncertain. Uncertainty is particularly relevant for estimates of one of the key parameters: equilibrium climate sensitivity—how eventual temperatures will react as atmospheric carbon dioxide concentrations double. Despite significant advances in climate science and increased confidence in the accuracy of the range itself, the “likely” range has been 1.5-4.5°C for over three decades. In 2007, the Intergovernmental Panel on Climate Change (IPCC) narrowed it to 2-4.5°C, only to reverse its decision in 2013, reinstating the prior range. In addition, the 2013 IPCC report removed prior mention of 3°C as the “best estimate.” We interpret the implications of the 2013 IPCC decision to lower the bottom of the range and excise a best estimate. Intuitively, it might seem that a lower bottom would be good news. Here we ask: When might apparently good news about climate sensitivity in fact be bad news? The lowered bottom value also implies higher uncertainty about the temperature increase, a definite bad. Under reasonable assumptions, both the lowering of the lower bound and the removal of the “best estimate” may well be bad news.

JEL-codes: D81 Q54 (search for similar items in EconPapers)
Date: 2015-01
New Economics Papers: this item is included in nep-agr and nep-env
Note: EEE
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

Published as Mark C. Freeman & Gernot Wagner & Richard J. Zeckhauser, 2015. "Climate sensitivity uncertainty: when is good news bad?," Philosophical Transactions of the Royal Society A: Mathematical, Physical and Engineering Sciences, vol 373(2055).

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Working Paper: Climate Sensitivity Uncertainty: When Is Good News Bad? (2015)
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