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Climate Change Feedback on Economic Growth: Explorations with a Dynamic General Equilibrium Model

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  • Eboli, Fabio
  • Parrado, Ramiro
  • Roson, Roberto

Abstract

Human-generated greenhouse gases depend on the level of economic activity. Therefore, most climate change studies are based on models and scenarios of economic growth. Economic growth itself, however, is likely to be affected by climate change impacts. These impacts affect the economy in multiple and complex ways: changes in productivity, resource endowments, production and consumption patterns. Moreover, impacts affect expected capital returns, international capital flows, savings and investments. We use a dynamic, multi-regional CGE model of the world economy to explore all these issues. We compare economic growth paths for the various regional economies, to answer the following questions: Will climate change impacts significantly affect growth and wealth distribution in the world? Should forecasts of human induced greenhouse gases emissions be revised, once climate change impacts are taken into account?

Suggested Citation

  • Eboli, Fabio & Parrado, Ramiro & Roson, Roberto, 2008. "Climate Change Feedback on Economic Growth: Explorations with a Dynamic General Equilibrium Model," Conference papers 331756, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
  • Handle: RePEc:ags:pugtwp:331756
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    References listed on IDEAS

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    More about this item

    Keywords

    Environmental Economics and Policy; Research Methods/ Statistical Methods;

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • E27 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Forecasting and Simulation: Models and Applications
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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