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Rethinking the costs related to global warming: A survey of the issues

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  • Paul Ekins
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    Abstract

    One approach to the economic analysis of global warming seeks to balance the costs of damage from or adaptation to it with the costs of mitigating it. The costs of adaptation and damage have been estimated using techniques of environmental evaluation, but are subject to a wide margin of uncertainty. The costs of mitigation, principally by reducing the emissions of CO 2, have been estimated using different kinds of economic models, some of the results of which have suggested that very little abatement of carbon emissions is justified before the costs of abatement exceed the benefits of it in terms of foregone damage and adaptation costs. The paper analyses the extent to which this conclusion is a function of the modelling assumptions and techniques used, rather than likely practical outcomes, with regard to the models' treatment of unemployed resources, revenue recycling, prior distortions in the economy due to the tax system and possible dynamic effects from the introduction of a carbon-energy tax. It concludes that, with different and arguably more appropriate treatment of the above issues, especially when the secondary benefits of reducing CO 2 emissions are also taken into account, it is not clear that even substantial reductions in the use of fossil fuels will incur net costs, especially if there is the prospect of even moderate costs from global warming. Copyright Kluwer Academic Publishers 1995

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    File URL: http://hdl.handle.net/10.1007/BF00705981
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    Bibliographic Info

    Article provided by European Association of Environmental and Resource Economists in its journal Environmental & Resource Economics.

    Volume (Year): 6 (1995)
    Issue (Month): 3 (October)
    Pages: 231-277

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    Handle: RePEc:kap:enreec:v:6:y:1995:i:3:p:231-277

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    Web page: http://www.springerlink.com/link.asp?id=100263

    Related research

    Keywords: Global warming; greenhouse gas abatement; carbon tax;

    References

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    Cited by:
    1. Sébastien Dessus & David O'Connor, 2003. "Climate Policy without Tears CGE-Based Ancillary Benefits Estimates for Chile," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 25(3), pages 287-317, July.
    2. Hans Asbjørn Aaheim & Kristin A. & Hans Seip, 1999. "Climate Change and Local Pollution Effects – An Integrated Approach," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 4(1), pages 61-81, March.
    3. Azar, Christian & Sterner, Thomas, 1996. "Discounting and distributional considerations in the context of global warming," Ecological Economics, Elsevier, vol. 19(2), pages 169-184, November.
    4. Olivier Godard, 1997. "Social Decision-Making under Scientific Controversy, Expertise, and the Precautionary Principle," Post-Print halshs-00624027, HAL.
    5. Olivier Godard, 1996. "Economic Expertise And Decision-Making In Controversial Universes," Post-Print halshs-00625518, HAL.

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