Is a Richer-But-Warmer World Better Than Poorer-But-Cooler Worlds?

Abstract

Greater economic growth could lead to greater greenhouse gas emissions, while simultaneously enhancing various aspects of human well-being and the capacity to adapt to climate change. This begs the question as to whether and, if so, for how long would a richer-but-warmer world be better for well-being than poorer-but-cooler worlds. To shed light on this issue, this paper draws upon results of the “Fast Track” assessment (FTA) reported in a special issue of Global Environmental Change: Part A 14 (1): 1–99 (2004), which employed the IPCC's emissions scenarios to project future climate change and its global impacts on various determinants of human and environmental well-being. Results suggest that notwithstanding climate change, through much of this century, human well-being is likely to be highest in the richest-but-warmest (A1FI) world and lower in poorer-but-cooler worlds. With respect to environmental well-being, matters may be best under the A1FI world for some critical environmental indicators through 2085–2100, but not necessarily for others. An alternative analysis using the Stern Review's worst-case results for potential welfare losses due to climate change indicates that welfare, adjusted for market and non-market impacts of climate change and the risk of catastrophe, should be highest under the A1FI scenario, at least through 2100.