Energy Balance Climate Models, Damage Reservoirs and the Time ProÃ‚ï¿½le of Climate Change Policy
AbstractA simpliÃƒï¿½Ã¯Â¿Â½ed energy balance climate model is considered with the global mean temperature as the state variable, and an endogenous ice line. The movements of the ice line towards the Poles are associated with damage reservoirs where initial damages are high and then eventually vanish as the ice caps vanish and the damage reservoir is exhausted. We couple this climate model with a simple economic growth model and we show that the endogenous ice line induces a nonlinearity. This nonlinearity when combined with two sources of damages - the conventional damages due to temperature increase and the reservoir damages - generates multiple steady states and Skiba points. It is shown that the policy ramp implied by this model calls for high mitigation now. Simulation results suggest that the policy ramp could be U-shaped instead of the monotonically increasing with low starting mitigation gradualist policy ramp.
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Bibliographic InfoPaper provided by Athens University of Economics and Business in its series DEOS Working Papers with number 1204.
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Energy Balance Climate Models; Damage Reservoir; Ice Line; Permafrost; Heat DiÃ‚Â¤usion; Policy Ramp; Skiba Points;
Find related papers by JEL classification:
- Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters
- Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-02-20 (All new papers)
- NEP-ENE-2012-02-20 (Energy Economics)
- NEP-ENV-2012-02-20 (Environmental Economics)
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