scholarly journals Climate Risks and Carbon Prices: Revising the Social Cost of Carbon

Author(s):  
Frank Ackerman ◽  
Elizabeth Stanton
2021 ◽  
Author(s):  
Richard Tol

Abstract Some claim that as knowledge about climate change accumulates, the social cost of carbon increases. A meta-analysis of published estimates shows that this is not the case. Correcting for inflation and emission year and controlling for the discount rate, kernel density decomposition reveals a stationary distribution. Actual carbon prices are almost everywhere below the estimated social cost of carbon.


2019 ◽  
Vol 127 (6) ◽  
pp. 2684-2734 ◽  
Author(s):  
Yongyang Cai ◽  
Thomas S. Lontzek

2015 ◽  
Vol 112 (52) ◽  
pp. 15827-15832 ◽  
Author(s):  
Francis Dennig ◽  
Mark B. Budolfson ◽  
Marc Fleurbaey ◽  
Asher Siebert ◽  
Robert H. Socolow

Integrated assessment models of climate and the economy provide estimates of the social cost of carbon and inform climate policy. We create a variant of the Regional Integrated model of Climate and the Economy (RICE)—a regionally disaggregated version of the Dynamic Integrated model of Climate and the Economy (DICE)—in which we introduce a more fine-grained representation of economic inequalities within the model’s regions. This allows us to model the common observation that climate change impacts are not evenly distributed within regions and that poorer people are more vulnerable than the rest of the population. Our results suggest that this is important to the social cost of carbon—as significant, potentially, for the optimal carbon price as the debate between Stern and Nordhaus on discounting.


2020 ◽  
Vol 10 (11) ◽  
pp. 1010-1014 ◽  
Author(s):  
Noah Kaufman ◽  
Alexander R. Barron ◽  
Wojciech Krawczyk ◽  
Peter Marsters ◽  
Haewon McJeon

2013 ◽  
Vol 51 (3) ◽  
pp. 873-882 ◽  
Author(s):  
Martin L Weitzman

The choice of an overall discount rate for climate change investments depends critically on how different components of investment payoffs are discounted at differing rates reflecting their underlying risk characteristics. Such underlying rates can vary enormously, from ≈ 1 percent for idiosyncratic diversifiable risk to ≈ 7 percent for systematic nondiversifiable risk. Which risk-adjusted rate is chosen can have a huge impact on cost-benefit analysis. In this expository paper, I attempt to set forth in accessible language with a simple linear model what I think are some of the basic issues involved in discounting climate risks. The paper introduces a new concept that may be relevant for climate-change discounting: the degree to which an investment hedges against the bad tail of catastrophic damages by insuring positive expected payoffs even under the worst circumstances. The prototype application is calculating the social cost of carbon. (JEL C51, Q54, Q58)


Author(s):  
Christoph Hambel ◽  
Holger Kraft ◽  
Eduardo Schwartz

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