Abstract
Deciding which climate policies to enact, and where and when to enact them, requires weighing their costs against the expected benefits. A key challenge in climate policy is how to value health impacts, which are likely to be large and varied, considering that they will accrue over long time horizons (centuries), will occur throughout the world, and will be distributed unevenly within countries depending in part on socioeconomic status. These features raise a number of important economic and ethical issues including how to value human life in different countries at different levels of development, how to value future people, and how much priority to give the poor and disadvantaged. In this article we review each of these issues, describe different approaches for addressing them in quantitative climate policy analysis, and show how their treatment can dramatically change what should be done about climate change. Finally, we use the social cost of carbon, which reflects the cost of adding carbon emissions to the atmosphere, as an example of how analysis of climate impacts is sensitive to ethical assumptions. We consider $20 a reasonable lower bound for the social cost of carbon, but we show that a much higher value is warranted given a strong concern for equity within and across generations.
Highlights
Maddalena Ferranna is a research associate in the Department of Global Health and Population at Harvard University, in Boston, Massachusetts
This article describes how these issues are commonly approached in the cost-benefit climate policy models that are routinely used by governments in regulatory analysis, including to estimate the social cost of carbon.We describe the cost-benefit analytic framework and explain how a best-practices approach goes beyond adding up the dollar value of the impacts, which ignores their distribution
In the final section we provide an illustration of these concepts and their importance, using the example of the social cost of carbon, including a discussion of the extent to which health impacts are properly accounted for and evaluated
Summary
Climate change will alter patterns of exposure to many important human health risks In some cases, this will occur through relatively direct pathways—for example, by increasing exposure to high outdoor temperatures, which is associated with morbidity and mortality from a variety of causes.[1,2] Other health impacts will be more indirect. Investments are needed to electrify the vehicle fleet, improve agricultural practices, and build large-scale renewable energy infrastructure. These investments, in turn, will increase the prices of many products and affect people’s everyday lives. Similar to the harms from climate change itself, the costs of mitigation policy, if it is poorly designed, may excessively burden disadvantaged populations, who tend to spend more of their incomes on energy and food
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