Modeling the Impact of CO₂ on Arctic and Antarctic Sea-Ice Volume: A Dynamic Nonlinear Approach

The year 2024 marked a critical milestone in global warming, with average global temperatures exceeding pre-industrial levels by 1.55°C— the highest on human historyrecords. Polar ice loss, largely attributed to anthropogenic CO₂ emissions has profound social, economic and financial implications that demand rigorous analysis. This study assesses the impact of atmospheric CO₂ on Arctic and Antarctic sea-ice volume usingnonlinear dynamic econometric models. We extend prior sea-ice forecasting models to allow for regime-switching specifications—Threshold Autoregressive (TAR) and Smooth Transition Regressions (STR) models—to capture the complex, nonlinear, and state-dependent responses of the sea-ice to CO₂ concentration changes. Our main contribution is to provide a flexible, reduced-form alternative to general circulation models (GCMs) for evaluating long-run climate scenarios under various emissions trajectories, including IPCC’s Shared Socioeconomic Pathways (SSPs). Results suggest Arctic sea-ice could disappear by 2060 [2045–2078] under a business-as-usual scenario, while Antarctic loss may extend beyond 2100 [2071–2300]. Importantly, models accounting for threshold effects reveal critical recovery tipping points that simpler linear climate models may overlook. Under an intermediate emissions path like SSP2-4.5, a fast recovery of sea-ice volume remains possible if regime shifts are driven by changes in CO₂ growth rates, with estimated tipping points for reversal occurring around 2033 for the Arctic and 2037 for the Antarctic. In contrast, the outlook is less favorable if regime dynamics are determined by CO₂ concentration levels: no recovery is projected for the Arctic, and the Antarctic recovery tipping point is delayed until 2069.