Carbon Burden

Lubos Pastor, Robert Stambaugh and Lucian A. Taylor

No 33110, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We quantify the U.S. corporate sector's future carbon damages by computing its “carbon burden”—the present value of social costs of its future carbon emissions. Our baseline estimate of the carbon burden is 131% of total corporate equity value. Even with indirect emissions excluded, 13% of firms have carbon burdens exceeding their market capitalizations. The 30 largest emitters account for all the decarbonization of U.S. corporations predicted by 2050. Predicted emission reductions, and even firms' targets, fall short of the Paris Agreement. Carbon burden is priced: firms with higher burdens have higher costs of capital, even controlling for past emissions.

JEL-codes: D62 G30 G38 Q51 Q54 (search for similar items in EconPapers)
Date: 2024-11
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