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The Social Cost of Carbon: Trends, Outliers and Catastrophes

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Author Info
Tol, Richard S.J.

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Abstract

211 estimates of the social cost of carbon are included in a meta-analysis. The results confirm that a lower discount rate implies a higher estimate; and that higher estimates are found in the gray literature. It is also found that there is a downward trend in the economic impact estimates of the climate; that the Stern Review?s estimates of the social cost of carbon is an outlier; and that the right tail of the distribution is fat. There is a fair chance that the annual climate liability exceeds the annual income of many people.

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Paper provided by Kiel Institute for the World Economy in its series Economics Discussion Papers with number 2007-44.

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Date of creation: 2007
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Handle: RePEc:zbw:ifwedp:6171

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Keywords: Climate change; social cost of carbon;

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Find related papers by JEL classification:
Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. David Pearce, 2003. "The Social Cost of Carbon and its Policy Implications," Oxford Review of Economic Policy, Oxford University Press, vol. 19(3), pages 362-384.
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    Other versions:
  3. William D. Nordhaus, 1982. "How Fast Should We Graze the Global Commons?," Cowles Foundation Discussion Papers 615, Cowles Foundation, Yale University. [Downloadable!]
    Other versions:
  4. Newell, Richard G. & Pizer, William A., 2003. "Discounting the distant future: how much do uncertain rates increase valuations?," Journal of Environmental Economics and Management, Elsevier, vol. 46(1), pages 52-71, July. [Downloadable!] (restricted)
    Other versions:
  5. Maddison, David, 1995. "A cost-benefit analysis of slowing climate change," Energy Policy, Elsevier, vol. 23(4-5), pages 337-346. [Downloadable!] (restricted)
  6. Robert Ayres & Jörg Walter, 1991. "The greenhouse effect: Damages, costs and abatement," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 1(3), pages 237-270, September. [Downloadable!] (restricted)
  7. P. Michael Link & Richard S.J. Tol, 2004. "Possible Economic Impacts of a Shutdown of the Thermohaline Circulation: an Application of FUND," Working Papers FNU-42, Research unit Sustainability and Global Change, Hamburg University, revised Apr 2004. [Downloadable!]
  8. Richard S. J. Tol & Gary W. Yohe, 2007. "A Stern Reply to the Reply to the Review of the Stern Review," World Economics, World Economics, Economic & Financial Publishing, PO Box 69, Henley-on-Thames, Oxfordshire, United Kingdom, RG9 1GB, vol. 8(2), pages 153-159, April. [Downloadable!]
  9. Gollier, Christian, 2002. "Time Horizon and the Discount Rate," Journal of Economic Theory, Elsevier, vol. 107(2), pages 463-473, December. [Downloadable!] (restricted)
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    A Growing International Opportunity to Move Strongly on Climate Change
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  12. Megan Ceronsky & David Anthoff & Cameron Hepburn & Richard S.J. Tol, 2005. "Checking The Price Tag On Catastrophe: The Social Cost Of Carbon Under Non-Linear Climate Response," Working Papers FNU-87, Research unit Sustainability and Global Change, Hamburg University, revised Aug 2005. [Downloadable!]
  13. Fankhauser, Samuel & Tol, Richard S.J. & Pearce, David W., 1998. "Extensions and alternatives to climate change impact valuation: on the critique of IPCC Working Group III's impact estimates," Environment and Development Economics, Cambridge University Press, vol. 3(01), pages 59-81, February. [Downloadable!]
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  16. Tol, Richard S.J., 2007. "Europe's long-term climate target: A critical evaluation," Energy Policy, Elsevier, vol. 35(1), pages 424-432, January. [Downloadable!] (restricted)
    Other versions:
  17. Rehdanz, Katrin & Maddison, David, 2005. "Climate and happiness," Ecological Economics, Elsevier, vol. 52(1), pages 111-125, January. [Downloadable!] (restricted)
    Other versions:
    • Katrin Rehdanz & David J. Maddison, 2003. "Climate and Happiness," Working Papers FNU-20, Research unit Sustainability and Global Change, Hamburg University, revised Apr 2003. [Downloadable!]
  18. Sir Ian Byatt & Bob Carter & Ian Castles & Chris de Freitas & Indur M. Goklany & David Henderson & David Holland & Lord Lawson of Blaby & Richard S. Lindzen & Ross McKitrick & Julian Morris & Sir Alan, 2006. "The Stern Review: A Dual Critique," World Economics, World Economics, Economic & Financial Publishing, PO Box 69, Henley-on-Thames, Oxfordshire, United Kingdom, RG9 1GB, vol. 7(4), pages 165-232, October. [Downloadable!]
  19. Samuel Fankhauser, 1994. "The Social Costs of Greenhouse Gas Emissions: An Expected Value Approach," The Energy Journal, International Association for Energy Economics, vol. 15(2), pages 157-184.
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  21. John Reilly & Kenneth Richards, 1993. "Climate change damage and the trace gas index issue," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 3(1), pages 41-61, February. [Downloadable!] (restricted)
  22. Tol, Richard S. J., 2002. "Welfare specifications and optimal control of climate change: an application of fund," Energy Economics, Elsevier, vol. 24(4), pages 367-376, July. [Downloadable!] (restricted)
  23. Simon Dietz & Chris Hope & Nicholas Stern & Dimitri Zenghelis, 2007. "REFLECTIONS ON THE STERN REVIEW (1)
    A Robust Case for Strong Action to Reduce the Risks of Climate Change
    ," World Economics, World Economics, Economic & Financial Publishing, PO Box 69, Henley-on-Thames, Oxfordshire, United Kingdom, RG9 1GB, vol. 8(1), pages 121-168, January. [Downloadable!]
  24. William D. Nordhaus & David Popp, 1997. "What is the Value of Scientific Knowledge? An Application to Global Warming Using the PRICE Model," The Energy Journal, International Association for Energy Economics, vol. 18(1), pages 1-46.
    Other versions:
  25. Spash, Clive L., 2007. "The economics of climate change impacts a la Stern: Novel and nuanced or rhetorically restricted?," Ecological Economics, Elsevier, vol. 63(4), pages 706-713, September. [Downloadable!] (restricted)
  26. Samuel Fankhauser & Richard Tol & DAVID Pearce, 1997. "The Aggregation of Climate Change Damages: a Welfare Theoretic Approach," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 10(3), pages 249-266, October. [Downloadable!] (restricted)
  27. Michael Schauer, 1995. "Estimation of the greenhouse gas externality with uncertainty," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 5(1), pages 71-82, January. [Downloadable!] (restricted)
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Tol, Richard S. J., 2009. "Intra- and Extra-Union Flexibility in Meeting the European Union's Emission Reduction Targets," Papers WP290, Economic and Social Research Institute (ESRI). [Downloadable!]
  2. Tol, Richard S. J., 2008. "The Economic Impact of Climate Change," Papers WP255, Economic and Social Research Institute (ESRI). [Downloadable!]
  3. Tol, Richard S. J., 2009. "The Feasibility of Low Concentration Targets: An Application of FUND," Papers WP285, Economic and Social Research Institute (ESRI). [Downloadable!]
  4. Aldy, Joseph E. & Ley, Eduardo & Parry, Ian W.H., 2008. "A Tax-Based Approach to Slowing Global Climate Change," Discussion Papers dp-08-26, Resources For the Future. [Downloadable!]
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