This book is a philosophical critique of the economics of climate change from both an ethical and philosophy of economics perspective. Mitigating climate change is not so much a scientific problem, but rather a political, social and above all an economic problem. A future without greenhouse gas emissions requires a radical transformation towards a sustainable low-carbon economy and society. How this transformation could be achieved raises numerous economic questions. Many of these questions remain untouched, although economists are equipped with a suitable toolkit and expertise. This book argues that economists have a social responsibility to carry out more research on how global warming could be stopped and that, ultimately, economic analysis of climate change must be a political economic approach that treats the economy as part of a wider social system. This approach will be of interest to policy makers, educators, students and researchers in support of more pluralism in economic research and teaching.

This unique and erudite second edition can be used at three different levels – advanced undergraduate, post-graduate and doctoral. It comprehensively covers the critical issues on the economics of climate change and climate policy features and clearly identifies the specific sections each level of reader should explore. Topics include the costs and benefits of adaptation and mitigation, discounting, uncertainty, policy instruments, and international agreements. Lectures can be combined with exercises, guided reading, or the building and application of an integrated assessment model. The book is accompanied by a website with background material, data, opinion pieces and videos. Although primarily intended for use in the classroom, anyone with an interest in climate policy can use this text as a reference.

We study the long-term impact of climate change on economic activity across countries, using a stochastic growth model where labor productivity is affected by country-specific climate variables—defined as deviations of temperature and precipitation from their historical norms. Using a panel data set of 174 countries over the years 1960 to 2014, we find that per-capita real output growth is adversely affected by persistent changes in the temperature above or below its historical norm, but we do not obtain any statistically significant effects for changes in precipitation. Our counterfactual analysis suggests that a persistent increase in average global temperature by 0.04°C per year, in the absence of mitigation policies, reduces world real GDP per capita by more than 7 percent by 2100. On the other hand, abiding by the Paris Agreement, thereby limiting the temperature increase to 0.01°C per annum, reduces the loss substantially to about 1 percent. These effects vary significantly across countries depending on the pace of temperature increases and variability of climate conditions. We also provide supplementary evidence using data on a sample of 48 U.S. states between 1963 and 2016, and show that climate change has a long-lasting adverse impact on real output in various states and economic sectors, and on labor productivity and employment.

Climate science paints a bleak picture: The continued growth of greenhouse gas emissions is increasingly likely to cause irreversible and catastrophic effects. Urgent action is needed to prepare for the initial rounds of climatic change, which are already unstoppable. While the opportunity to avert all climate damage has now passed, well-designed mitigation and adaptation policies, if adopted quickly, could still greatly reduce the likelihood of the most tragic and far-reaching impacts of climate change. Climate economics is the bridge between science and policy, translating scientific predictions about physical systems into projections about economic growth and human welfare that decision makers can most readily use but it has too often consisted of an overly technical, academic approach to the problem. Getting climate economics right is not about publishing the cleverest article of the year but rather about helping solve the dilemma of the century. The tasks ahead are daunting, and failure, unfortunately, is quite possible. Better approaches to climate economics will allow economists to be part of the solution rather than part of the problem. This book analyzes potential paths for improvement.

The 2nd edition of An Introduction to Climate Change Economics and Policy explains the key scientific, economic and policy issues related to climate change in a completely up-to-date introduction for anyone interested, and students at all levels in various related courses, including environmental economics, international development, geography, politics and international relations. FitzRoy and Papyrakis highlight how economists and policymakers often misunderstand the science of climate change, underestimate the growing threat to future civilization and survival and exaggerate the costs of radical measures needed to stabilize the climate. In contrast, they show how direct and indirect costs of fossil fuels – particularly the huge health costs of local pollution – actually exceed the investment needed for transition to an almost zero carbon economy in two or three decades using available technology.

This study examines the costs and benefits of an aggressive program of global action to limit the greenhouse effect. Cline summarizes the issues from the standpoint of an economist and estimates the damages of long-term warming.

This book presents the latest science and social science research on whether the world can adapt to climate change.