IDEAS home Printed from https://ideas.repec.org/a/anr/reseco/v3y2011p419-443.html
   My bibliography  Save this article

The Social Cost of Carbon

Author

Listed:
  • Richard S.J. Tol

    (Economic and Social Research Institute, Whitaker Square, Sir John Rogerson's Quay, Dublin 2, Ireland
    Institute for Environmental Studies, Vrije Universiteit, Amsterdam, The Netherlands, Department of Spatial Economics, Vrije Universiteit, Amsterdam, The Netherlands, Department of Economics, Trinity College, Dublin, Ireland)

Abstract

This article surveys the literature on the economic impact of climate change. Different methods have been used to estimate the impact of climate change on human welfare. Studies agree that there are positive and negative impacts. In the short term, positive impacts may dominate, but these are sunk benefits that will obtain regardless of abatement policy. In the longer term, there are net negative impacts. Poorer people tend to be more vulnerable to climate change. Estimated aggregate impacts are not very large, but they are uncertain and incomplete. Estimates of the marginal impacts suggest that greenhouse gas emissions should be taxed and that the emission reduction targets announced by politicians are probably too ambitious. Estimates of the willingness to pay for climate policy suggest that lay people are probably more concerned than experts about the total impact of climate change, whereas lay people and experts agree on estimates of the incremental impact of carbon dioxide emissions.

Suggested Citation

  • Richard S.J. Tol, 2011. "The Social Cost of Carbon," Annual Review of Resource Economics, Annual Reviews, vol. 3(1), pages 419-443, October.
  • Handle: RePEc:anr:reseco:v:3:y:2011:p:419-443
    as

    Download full text from publisher

    File URL: http://www.annualreviews.org/doi/abs/10.1146/annurev-resource-083110-120028
    Download Restriction: Full text downloads are only available to subscribers. Visit the abstract page for more information.
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. van den Bergh, Jeroen C. J. M., 2004. "Optimal climate policy is a utopia: from quantitative to qualitative cost-benefit analysis," Ecological Economics, Elsevier, vol. 48(4), pages 385-393, April.
    2. G. C. van Kooten, 2004. "Climate Change Economics," Books, Edward Elgar Publishing, number 3424.
    3. Minh Ha-Duong & Nicolas Treich, 2004. "Risk Aversion, Intergenerational Equity and Climate Change," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 28(2), pages 195-207, June.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Richard S J Tol, 2018. "The Economic Impacts of Climate Change," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 12(1), pages 4-25.
    2. van den Bergh, J.C.J.M. & Botzen, W.J.W., 2015. "Monetary valuation of the social cost of CO2 emissions: A critical survey," Ecological Economics, Elsevier, vol. 114(C), pages 33-46.
    3. Svenja Hector, 2013. "Accounting for Different Uncertainties: Implications for Climate Investments?," Working Papers 2013.107, Fondazione Eni Enrico Mattei.
    4. Berger, Loïc & Emmerling, Johannes, 2017. "Welfare as Simple(x) Equity Equivalents," MITP: Mitigation, Innovation and Transformation Pathways 254044, Fondazione Eni Enrico Mattei (FEEM).
    5. van den Bergh, Jeroen C.J.M., 2010. "Externality or sustainability economics?," Ecological Economics, Elsevier, vol. 69(11), pages 2047-2052, September.
    6. Adler, Matthew D. & Treich, Nicolas, 2017. "Utilitarianism, prioritarianism, and intergenerational equity: A cake eating model," Mathematical Social Sciences, Elsevier, vol. 87(C), pages 94-102.
    7. Peterson, Deborah C., 2006. "Precaution: principles and practice in Australian environmental and natural resource management," Conference Workshop Proceedings 31906, Productivity Commission.
    8. Tol, Richard S.J., 2012. "A cost–benefit analysis of the EU 20/20/2020 package," Energy Policy, Elsevier, vol. 49(C), pages 288-295.
    9. Noah Kaufman, 2012. "The bias of integrated assessment models that ignore climate catastrophes," Climatic Change, Springer, vol. 110(3), pages 575-595, February.
    10. van Kooten, G. Cornelis, 2004. "Economics of Forest and Agricultural Carbon Sinks," Working Papers 18160, University of Victoria, Resource Economics and Policy.
    11. Nijkamp Peter, 2012. "Behaviour of Humans and Behaviour of Models in Dynamic Space," Quaestiones Geographicae, Sciendo, vol. 31(2), pages 7-19, June.
    12. Frank Ackerman & Ian J. Finlayson, 2006. "The economics of inaction on climate change: a sensitivity analysis," Climate Policy, Taylor & Francis Journals, vol. 6(5), pages 509-526, September.
    13. Nijnik, Maria & Pajot, Guillaume & Moffat, Andy J. & Slee, Bill, 2013. "An economic analysis of the establishment of forest plantations in the United Kingdom to mitigate climatic change," Forest Policy and Economics, Elsevier, vol. 26(C), pages 34-42.
    14. Tol, Richard S.J., 2013. "Targets for global climate policy: An overview," Journal of Economic Dynamics and Control, Elsevier, vol. 37(5), pages 911-928.
    15. Kousky, Carolyn & Rostapshova, Olga & Toman, Michael & Zeckhauser, Richard, 2009. "Responding to threats of climate change mega-catastrophes," Policy Research Working Paper Series 5127, The World Bank.
    16. Jean-Charles Hourcade & Philippe Ambrosi & Patrice Dumas, 2009. "Beyond the Stern Review: Lessons from a risky venture at the limits of the cost–benefit analysis," Post-Print hal-00716769, HAL.
    17. Emmanuelle Augeraud-Véron & Giorgio Fabbri & Katheline Schubert, 2019. "The Value of Biodiversity as an Insurance Device," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 101(4), pages 1068-1081.
    18. Helgeson, Jennifer & Dietz, Simon & Atkinson, Giles D. & Hepburn, Cameron & Sælen, Håkon, 2009. "Siblings, not triplets: social preferences for risk, inequality and time in discounting climate change," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW), vol. 3, pages 1-28.
    19. Emmanuelle Augeraud-Véron & Giorgio Fabbri & Katheline Schubert, 2019. "The Value of Biodiversity as an Insurance Device," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 101(4), pages 1068-1081.
    20. Rogers, Patricia J. & Stevens, Kaye & Boymal, Jonathan, 2009. "Qualitative cost-benefit evaluation of complex, emergent programs," Evaluation and Program Planning, Elsevier, vol. 32(1), pages 83-90, February.

    More about this item

    Keywords

    climate policy; carbon dioxide emission reduction; benefit-cost analysis;
    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

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:anr:reseco:v:3:y:2011:p:419-443. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: . General contact details of provider: http://www.annualreviews.org .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: http://www.annualreviews.org (email available below). General contact details of provider: http://www.annualreviews.org .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.