Abstract
Abstract. Anthropogenic climate change raises growing concerns about its potential catastrophic impacts on both ecosystems and human societies. Yet, several studies on damage induced on the economy by unmitigated global warming have proposed a much less worrying picture of the future, with only a few points of decrease in the world gross domestic product (GDP) per capita by the end of the century, even for a global warming above 4 ∘C. We consider two different empirically estimated functions linking GDP growth or GDP level to temperature at the country level and apply them to a global cooling of 4 ∘C in 2100, corresponding to a return to glacial conditions. We show that the alleged impact on global average GDP per capita runs from −1.8 %, if temperature impacts GDP level, to +36 %, if the impact is rather on GDP growth. These results are then compared to the hypothetical environmental conditions faced by humanity, taking the Last Glacial Maximum as a reference. The modeled impacts on the world GDP appear strongly underestimated given the magnitude of climate and ecological changes recorded for that period. After discussing the weaknesses of the aggregated statistical approach to estimate economic damage, we conclude that, if these functions cannot reasonably be trusted for such a large cooling, they should not be considered to provide relevant information on potential damage in the case of a warming of similar magnitude, as projected in the case of unabated greenhouse gas emissions.
Highlights
Since the first Intergovernmental Panel on Climate Change (IPCC, 1990) report, anthropogenic climate change has been the subject of large research efforts
– The function of Newell et al (2018) has not been published in a peer-reviewed journal4, but we considered it anyway because (1) it belongs to the family of damage functions assuming an impact of climate on gross domestic product (GDP) level rather than growth, leading to very little damage, and (2) it is based on the same data and methodology as Burke et al (2015), simplifying the exercise
In order to assess the economic damage of a hypothetical return to an ice age, we compute the evolution of average GDP per capita by country with or without the corresponding global cooling, following the methodology described in BHM using the replication data provided with their publication
Summary
Since the first Intergovernmental Panel on Climate Change (IPCC, 1990) report, anthropogenic climate change has been the subject of large research efforts. In addition to the worsening of mean climate conditions in many places, numerous studies emphasize the risks associated with increased frequency and/or magnitude of extreme events (e.g., droughts, heat waves, storms, floods), rising sea level, and glacier melting (IPCC, 2013). These risks have drawn attention to potential catastrophic consequences for the world economy (Weitzman, 2012; Dietz and Stern, 2015; Bovari et al, 2018). At the heart of many macroeconomic analyses of climate change impacts, have, been heavily criticized for their lack of empirical or theoretical foundations and for their inadequacy to evaluate the impact of climate change outside the calibration range (Pindyck, 2013, 2017; Pottier, 2016; Pezzey, 2019)
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