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Steering the Climate System: An Extended Comment

Author

Listed:
  • Linus Mattauch
  • Richard Millar
  • Rick van der Ploeg
  • Armon Rezai
  • Anselm Schultes
  • Frank Venmans
  • Nico Bauer
  • Simon Dietz
  • Ottmar Edenhofer
  • Niall Farrell
  • Cameron Hepburn
  • Gunnar Luderer
  • Jacquelyn Pless
  • Fiona Spuler
  • Nicholas Stern FBA
  • Alexander Teytelboym

Abstract

Lemoine and Rudik (2017) argue that it is efficient to delay reducing carbon emissions, because there is substantial inertia in the climate system. However, this conclusion rests upon misunderstanding the relevant climate physics: there is no substantial lag between CO2 emissions and warming, which policy could rely upon. Applying a mainstream climate physics model to the economics of Lemoine and Rudik (2017) invalidates the article’s implications for climate policy: the cost-effective carbon price that limits warming to a range of targets including 2 oC starts high and increases at the interest rate.

Suggested Citation

  • Linus Mattauch & Richard Millar & Rick van der Ploeg & Armon Rezai & Anselm Schultes & Frank Venmans & Nico Bauer & Simon Dietz & Ottmar Edenhofer & Niall Farrell & Cameron Hepburn & Gunnar Luderer & , 2018. "Steering the Climate System: An Extended Comment," CESifo Working Paper Series 7414, CESifo.
    • Handle: RePEc:ces:ceswps:_7414
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    File URL: https://www.cesifo.org/DocDL/cesifo1_wp7414.pdf
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    Other versions of this item:

    • Mattauch, Linus & Hepburn, Cameron & Millar, Richard & van der Ploeg, Frederick & Rezai, Armon & Schultes, Anselm & Venmans, Frank & Bauer, Nico & Dietz, Simon & Edenhofer, Ottmar & Farrell, Niall & L, 2018. "Steering the climate system: an extended comment," INET Oxford Working Papers 2018-17, Institute for New Economic Thinking at the Oxford Martin School, University of Oxford.

    References listed on IDEAS

    as
    1. Reto Knutti & Joeri Rogelj, 2015. "The legacy of our CO 2 emissions: a clash of scientific facts, politics and ethics," Climatic Change, Springer, vol. 133(3), pages 361-373, December.
    2. Derek Lemoine & Ivan Rudik, 2017. "Steering the Climate System: Using Inertia to Lower the Cost of Policy," American Economic Review, American Economic Association, vol. 107(10), pages 2947-2957, October.
    3. Richard Millar & Myles Allen & Joeri Rogelj & Pierre Friedlingstein, 2016. "The cumulative carbon budget and its implications," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 32(2), pages 323-342.
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    Cited by:

    1. Xu Lin & Sweder van Wijnbergen, "undated". "The Social Cost of Carbon under Climate Volatility Risk," Tinbergen Institute Discussion Papers 23-032/IV, Tinbergen Institute.
    2. Simon Dietz & Bruno Lanz, 2019. "Growth and Adaptation to Climate Change in the Long Run," CESifo Working Paper Series 7986, CESifo.
    3. van der Ploeg, Frederick & Rezai, Armon, 2020. "The risk of policy tipping and stranded carbon assets," Journal of Environmental Economics and Management, Elsevier, vol. 100(C).

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    More about this item

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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