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Incorporating Climate Uncertainty into Estimates of Climate Change Impacts

Author

Listed:
  • Marshall Burke

    (Stanford University)

  • John Dykema

    (Harvard University)

  • David B. Lobell

    (Stanford University)

  • Edward Miguel

    (University of California, Berkeley)

  • Shanker Satyanath

    (New York University)

Abstract

Quantitative estimates of the impacts of climate change on economic outcomes are important for public policy. We show that the vast majority of estimates fail to account for well-established uncertainty in future temperature and rainfall changes, leading to potentially misleading projections. We reexamine seven well-cited studies and show that accounting for climate uncertainty leads to a much larger range of projected climate impacts and a greater likelihood of worst-case outcomes, an important policy parameter. Incorporating climate uncertainty into future economic impact assessments will be critical for providing the best possible information on potential impacts. © 2015 The President and Fellows of Harvard College and the Massachusetts Institute of Technology

Suggested Citation

  • Marshall Burke & John Dykema & David B. Lobell & Edward Miguel & Shanker Satyanath, 2015. "Incorporating Climate Uncertainty into Estimates of Climate Change Impacts," The Review of Economics and Statistics, MIT Press, vol. 97(2), pages 461-471, May.
    • Handle: RePEc:tpr:restat:v:97:y:2015:i:2:p:461-471
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    File URL: http://www.mitpressjournals.org/doi/pdf/10.1162/REST_a_00478
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    References listed on IDEAS

    as
    1. Stern,Nicholas, 2007. "The Economics of Climate Change," Cambridge Books, Cambridge University Press, number 9780521700801.
    2. Anthony C. Fisher & W. Michael Hanemann & Michael J. Roberts & Wolfram Schlenker, 2012. "The Economic Impacts of Climate Change: Evidence from Agricultural Output and Random Fluctuations in Weather: Comment," American Economic Review, American Economic Association, vol. 102(7), pages 3749-3760, December.
    3. Olivier Deschênes & Michael Greenstone, 2012. "The Economic Impacts of Climate Change: Evidence from Agricultural Output and Random Fluctuations in Weather: Reply," American Economic Review, American Economic Association, vol. 102(7), pages 3761-3773, December.
    4. Martin L. Weitzman, 2009. "On Modeling and Interpreting the Economics of Catastrophic Climate Change," The Review of Economics and Statistics, MIT Press, vol. 91(1), pages 1-19, February.
    5. Melissa Dell & Benjamin F. Jones & Benjamin A. Olken, 2012. "Temperature Shocks and Economic Growth: Evidence from the Last Half Century," American Economic Journal: Macroeconomics, American Economic Association, vol. 4(3), pages 66-95, July.
    6. Mendelsohn, Robert & Nordhaus, William D & Shaw, Daigee, 1994. "The Impact of Global Warming on Agriculture: A Ricardian Analysis," American Economic Review, American Economic Association, vol. 84(4), pages 753-771, September.
    7. Olivier Deschênes & Michael Greenstone, 2007. "The Economic Impacts of Climate Change: Evidence from Agricultural Output and Random Fluctuations in Weather," American Economic Review, American Economic Association, vol. 97(1), pages 354-385, March.
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    More about this item

    Keywords

    climate change; economic outcomes; public policy; temperature; rainfall changes; projections; misleading; climate uncertainty; climate impacts; policy parameter; economic impact assessments;
    All these keywords.

    JEL classification:

    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q50 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - General
    • A00 - General Economics and Teaching - - General - - - General
    • B00 - Schools of Economic Thought and Methodology - - General - - - History of Economic Thought, Methodology, and Heterodox Approaches

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