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Climate Economics: A Meta-Review and Some Suggestions

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  • Geoffrey Heal

Abstract

What have we learned from the outpouring of literature as a result of the Stern Review of the Economics of Climate Change? A lot. We have explored the model space and the parameter space much more thoroughly, though there are still unexplored regions. While there are aspects of the Stern Review's analysis with which we can disagree, it seems fair to say that it has catalyzed a fundamental rethinking of the economic case for action on climate change. We are now in a position to give some conditions that are sufficient to provide a case for strong action on climate change, but need more work before we have a fully satisfactory account of the relevant economics. In particular we need to understand better how climate change affects natural capital - the natural environment and the ecosystems comprising it - and how these affect human welfare.

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  • Geoffrey Heal, 2008. "Climate Economics: A Meta-Review and Some Suggestions," NBER Working Papers 13927, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:13927
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    Cited by:

    1. Gerd Nicodemus, 2010. "The Option Value of Investments in Energy-Efficient and Renewable Energy Technologies," Duesseldorf Working Papers in Applied Management and Economics 13, Duesseldorf University of Applied Sciences.
    2. Johansson-Stenman, Olof & Sterner, Thomas, 2015. "Discounting and relative consumption," Journal of Environmental Economics and Management, Elsevier, vol. 71(C), pages 19-33.
    3. Min Gong & David Krantz & Elke Weber, 2014. "Why Chinese discount future financial and environmental gains but not losses more than Americans," Journal of Risk and Uncertainty, Springer, vol. 49(2), pages 103-124, October.
    4. Simon Dietz & David Maddison, 2009. "New Frontiers in the Economics of Climate Change," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 43(3), pages 295-306, July.
    5. Hatem M'henni & Mohamed El Hedi Arouri & Adel Ben Youssef & Christophe Rault, 2011. "Income Level and Environmental Quality in The MENA Countries: Discussing the Environmental Kuznets Curve Hypothesis," Working Papers 587, Economic Research Forum, revised 05 Jan 2011.
    6. Engelbrecht, Hans-Jürgen, 2009. "Natural capital, subjective well-being, and the new welfare economics of sustainability: Some evidence from cross-country regressions," Ecological Economics, Elsevier, vol. 69(2), pages 380-388, December.
    7. Pindyck, Robert S., 2012. "Uncertain outcomes and climate change policy," Journal of Environmental Economics and Management, Elsevier, vol. 63(3), pages 289-303.
    8. Pauline Barrieu & Sinclair Desgagn�, 2009. "Economic policy when models disagree," GRI Working Papers 4, Grantham Research Institute on Climate Change and the Environment.
    9. Majah-Leah Ravago & James Roumasset, 2016. "The Public Economics of Electricity Policy with Philippine Applications," Working Papers 201613, University of Hawaii at Manoa, Department of Economics.
    10. Simon Dietz, 2011. "High impact, low probability? An empirical analysis of risk in the economics of climate change," Climatic Change, Springer, vol. 108(3), pages 519-541, October.
    11. Anne Musson, 2012. "The importance of the stakeholders’ involvement in building indicators. The case of environmental regulation in France," Working Papers hal-02947023, HAL.
    12. Pedro Conceição & Yanchun Zhang, 2010. "Discounting in the context of climate change economics: the policy implications of uncertainty and global asymmetries," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 12(1), pages 31-57, June.
    13. Maciej Bukowski & Pawel Kowal, 2010. "Large scale, multi-sector DSGE model as a climate policy assessment tool - Macroeconomic Mitigation Options (MEMO) model for Poland," IBS Working Papers 3/2010, Instytut Badan Strukturalnych.
    14. Anne Musson, 2012. "The importance of the stakeholders’ involvement in building indicators. The case of environmental regulation in France," Working Papers hal-02947023, HAL.
    15. Rob Aalbers, 2009. "Discounting investments in mitigation and adaptation: a dynamic stochastic general equilibrium approach of climate change," CPB Discussion Paper 126, CPB Netherlands Bureau for Economic Policy Analysis.
    16. 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.
    17. Partha Dasgupta, 2008. "Discounting climate change," Journal of Risk and Uncertainty, Springer, vol. 37(2), pages 141-169, December.
    18. Dietz, Simon, 2011. "High impact, low probability?: an empirical analysis of risk in the economics of climate change," LSE Research Online Documents on Economics 38586, London School of Economics and Political Science, LSE Library.
    19. Pauline Barrieu & Bernard Sinclair-Desgagné, 2009. "Economic Policy when Models Disagree," CIRANO Working Papers 2009s-03, CIRANO.
    20. Nkuiya, Bruno, 2020. "Tradeoffs between costly capacity investment and risk of regime shift," Economic Modelling, Elsevier, vol. 91(C), pages 117-127.
    21. Dietz, Simon, 2009. "High impact, low probability? An empirical analysis of risk in the economics of climate change," LSE Research Online Documents on Economics 37612, London School of Economics and Political Science, LSE Library.
    22. Stephen Newbold & Adam Daigneault, 2009. "Climate Response Uncertainty and the Benefits of Greenhouse Gas Emissions Reductions," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 44(3), pages 351-377, November.
    23. Buchholz, Wolfgang & Schumacher, Jan, 2010. "Discounting and welfare analysis over time: Choosing the [eta]," European Journal of Political Economy, Elsevier, vol. 26(3), pages 372-385, September.
    24. Simon Dietz, 2009. "High impact, low probability? An empirical analysis of risk in the economics of climate change," GRI Working Papers 9, Grantham Research Institute on Climate Change and the Environment.
    25. Geoffrey Heal, 2009. "The Economics of Renewable Energy," NBER Working Papers 15081, National Bureau of Economic Research, Inc.

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    JEL classification:

    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • D9 - Microeconomics - - Micro-Based Behavioral Economics
    • Q01 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - Sustainable Development

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