Energy Balance Climate Models, Damage Reservoirs and the Time Profile of Climate Change Policy
A simplified energy balance climate model is considered with the global mean temperature as the state variable, and an endogenous ice line. The movements of the ice line towards the Poles are associated with damage reservoirs where initial damages are high and then eventually vanish as the ice caps vanish and the damage reservoir is exhausted. We couple this climate model with a simple economic growth model and we show that the endogenous ice line induces a nonlinearity. This nonlinearity when combined with two sources of damages - the conventional damages due to temperature increase and the reservoir damages - generates multiple steady states and Skiba points. It is shown that the policy ramp implied by this model calls for high mitigation now. Simulation results suggest that the policy ramp could be U-shaped instead of the monotonically increasing with low starting mitigation gradualist policy ramp.
|Date of creation:||Mar 2012|
|Contact details of provider:|| Postal: Corso Magenta, 63 - 20123 Milan|
Web page: http://www.feem.it/
More information through EDIRC
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.:
- Xepapadeas, Anastasios, 2005. "Economic growth and the environment," Handbook of Environmental Economics,in: K. G. Mäler & J. R. Vincent (ed.), Handbook of Environmental Economics, edition 1, volume 3, chapter 23, pages 1219-1271 Elsevier.
- Gustav Engstrom & William Brock & Anastasios Xepapadeas, 2012.
"Energy Balance Climate Models and the Spatial Structure of Optimal Mitigation Policies,"
DEOS Working Papers
1202, Athens University of Economics and Business.
- William Brock & Gustav Engstrom & Anastasios Xepapadeas, 2012. "Energy Balance Climate Models and the Spatial Structure of Optimal Mitigation Policies," Working Papers 2012.05, Fondazione Eni Enrico Mattei.
- Kenneth L. Judd, 1998. "Numerical Methods in Economics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262100711, July.
- Lempert, Robert J. & Sanstad, Alan H. & Schlesinger, Michael E., 2006. "Multiple equilibria in a stochastic implementation of DICE with abrupt climate change," Energy Economics, Elsevier, vol. 28(5-6), pages 677-689, November.
- W.A. Brock & D. Starrett, 2003. "Managing Systems with Non-convex Positive Feedback," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 26(4), pages 575-602, December.
- Elizabeth Stanton, 2011. "Negishi welfare weights in integrated assessment models: the mathematics of global inequality," Climatic Change, Springer, vol. 107(3), pages 417-432, August.
- Keller, Klaus & Bolker, Benjamin M. & Bradford, D.F.David F., 2004. "Uncertain climate thresholds and optimal economic growth," Journal of Environmental Economics and Management, Elsevier, vol. 48(1), pages 723-741, July. Full references (including those not matched with items on IDEAS)