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Urban and non-urban contributions to the social cost of carbon

Author

Listed:
  • Francisco Estrada

    (Universidad Nacional Autónoma de México
    Vrije Universiteit
    Universidad Nacional Autónoma de México)

  • Veronica Lupi

    (Vrije Universiteit
    Fondazione Eni Enrico Mattei)

  • W. J. Wouter Botzen

    (Vrije Universiteit)

  • Richard S. J. Tol

    (Vrije Universiteit
    University of Sussex
    Vrije Universiteit
    Tinbergen Institute)

Abstract

The social cost of carbon (SCC) serves as a concise measure of climate change’s economic impact, often reported at the global and country level. SCC values tend to be disproportionately high for less-developed, populous countries. Previous studies do not distinguish between urban and non-urban areas and ignore the synergies between local and global warming. High exposure and concurrent socioenvironmental problems exacerbate climate change risks in cities. Using a spatially explicit integrated assessment model, the SCC is estimated at USD$187/tCO2, rising to USD$490/tCO2 when including urban heat island (UHI) warming. Urban SCC dominates, representing about 78%-93% of the global SCC, due to both urban exposure and the UHI. This finding implies that the highest global greenhouse gases (GHGs) emitters also experience the largest economic losses. Global cities have substantial leverage on climate policy at the national and global scales and strong incentives for a swift transition to a low-carbon economy.

Suggested Citation

  • Francisco Estrada & Veronica Lupi & W. J. Wouter Botzen & Richard S. J. Tol, 2025. "Urban and non-urban contributions to the social cost of carbon," Nature Communications, Nature, vol. 16(1), pages 1-11, December.
    • Handle: RePEc:nat:natcom:v:16:y:2025:i:1:d:10.1038_s41467-025-59466-y
    DOI: 10.1038/s41467-025-59466-y
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    References listed on IDEAS

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    1. Lucas Chancel, 2022. "Global carbon inequality over 1990–2019," PSE-Ecole d'économie de Paris (Postprint) halshs-04157767, HAL.
    2. Lucas Chancel, 2022. "Global carbon inequality over 1990–2019," Nature Sustainability, Nature, vol. 5(11), pages 931-938, November.
    3. Lucas Chancel, 2022. "Global carbon inequality over 1990–2019," Post-Print halshs-04157767, HAL.
    4. Glen P. Peters & Robbie M. Andrew & Josep G. Canadell & Sabine Fuss & Robert B. Jackson & Jan Ivar Korsbakken & Corinne Le Quéré & Nebojsa Nakicenovic, 2017. "Key indicators to track current progress and future ambition of the Paris Agreement," Nature Climate Change, Nature, vol. 7(2), pages 118-122, February.
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