Economic analysis of climate change

Short description: none

Economic analysis of climate change uses economic tools and models to calculate the scale and distribution of damages caused by climate change. It can also give guidance for the best policies for mitigation and adaptation to climate change from an economic perspective. There are many economic models and frameworks. For example, in a cost–benefit analysis, the trade offs between climate change impacts, adaptation, and mitigation are made explicit. For this kind of analysis, integrated assessment models (IAMs) are useful. Those models link main features of society and economy with the biosphere and atmosphere into one modelling framework.[1]

In general, climate damages increase the more the global surface temperature increases.[2] Many effects of climate change are linked to market transactions and therefore directly affect metrics like GDP or inflation.[3]: 936–941 For instance, climate change can drive inflation in food via heat and droughts, but also drives up overall inflation.[4] There are also non-market impacts which are harder to translate into economic costs.[5] These include the impacts of climate change on human health, biomes and ecosystem services.

Economic analysis also looks at the economics of climate change mitigation and the cost of climate adaptation. Mitigation costs will vary according to how and when emissions are cut. Early, well-planned action will minimize the costs.[6] Globally, the benefits and co-benefits of keeping warming under 2 °C exceed the costs.[7] Cost estimates for mitigation for specific regions depend on the quantity of emissions allowed for that region in future, as well as the timing of policies.[8]: 90 Economists estimate the incremental cost of climate change mitigation at less than 1% of GDP.[9] Across all developing countries, adaptation costs have been estimated to be about USD 215 billion per year up to 2030, and are expected to be higher after.[10]: 35–36

## Contents

* 1 Purposes
* 2 Types of economic models
* 2.1 Process-based models
* 2.2 Structural models
* 2.2.1 Computable general equilibrium models
* 2.2.2 Aggregate cost-benefit models
* 2.3 Statistical (econometric) methods
* 3 Analytical frameworks
* 3.1 Cost–benefit analysis
* 3.1.1 Damage functions
* 3.2 Cost-effectiveness analysis
* 3.3 Scenario-based assessments
* 3.4 Risk management
* 3.4.1 Iterative risk management
* 3.4.2 Portfolio analysis
* 4 Costs of climate impacts
* 4.1 At the global level
* 4.1.1 High emissions scenarios
* 4.2 Underestimation of economic impacts
* 4.3 By region
* 4.4 By sector
* 4.4.1 Health and productivity
* 4.4.2 Agriculture
* 4.4.3 Industry
* 4.5 Impacts on living costs
* 4.6 Utility of aggregated assessment
* 5 Costs of mitigation
* 5.1 Global costs of mitigation
* 5.2 Regional costs of mitigation
* 5.3 Sharing of mitigation costs
* 6 Costs of adaptation
* 7 Challenges and debates
* 7.1 Efficiency and equity
* 7.2 Insurance and markets
* 7.3 Effects of economic growth and degrowth scenarios on emissions
* 8 Economics of climate change mitigation
* 8.1 Policies and approaches to reduce emissions
* 8.1.1 Price signals
* 8.1.2 Structural market reforms
* 8.1.3 Degrowth
* 8.2 Assessing costs and benefits
* 8.2.1 GDP
* 8.2.2 Baselines
* 8.2.3 Ancillary impacts
* 8.2.4 Flexibility
* 8.2.5 Discount rates
* 8.3 Economic barriers to addressing climate change mitigation
* 9 See also
* 10 References
* 10.1 Sources
* 11 External links

## Purposes

Economic analysis of climate change investigates the economic impacts of the effects of climate change, the costs and benefits of preventing climate change, and the cost of adapting to a changing climate. These analyses can focus on:[11]: 2495

* Global aggregate economic costs of climate change (i.e. global climate damages)
* Sectoral or regional economic costs of climate change (e.g. costs to agriculture sector or energy services)
* Economic costs and benefits of implementing climate change mitigation and adaptation strategies
* Estimating the projected impacts to society per additional metric tonne of carbon emissions (social cost of carbon)
* informing policy decisions, interntionally or nationally

The economic impacts of climate change also include any mitigation (for example, limiting the global average temperature below 2 °C) or adaption (for example, building flood defences) employed by nations or groups of nations, which might infer economic consequences.[12][13][14] Some regions or sectors may benefit from low levels of warming, for example through lower energy demand or improved crop yields.[11]: 2496 [15]: 11

In some areas, policies designed to mitigate climate change may contribute towards other sustainable development objectives, such as abolishing fossil fuel subsidies which would reduce air pollution and thus save lives.[16][17][18] Direct global fossil fuel subsidies reached $319 billion in 2017, and $5.2 trillion when indirect costs such as air pollution are priced in.[19] In other areas, the cost of climate change mitigation might divert resources away from other socially and environmentally beneficial investments (the opportunity costs of climate change policy).[16][17]

## Types of economic models

Many economic tools are employed to understand the economic aspects around impacts of climate change, climate change mitigation and adaptation. Several approaches exist. Econometric models (statistical models) are used to estimate the impacts of weather and climate on economic variables, either globally or for a specific sector. Structural economic models look at market and non-market impacts affecting the whole economy through its inputs and outputs. Process models simulate physical, chemical and biological processes under climate change, and the economic effects.[11]: 2495

### Process-based models

This section is an excerpt from Integrated assessment modelling § Process-based models[ edit ]

### Structural models

#### Computable general equilibrium models

This section is an excerpt from Computable general equilibrium[ edit ]

Computable general equilibrium (CGE) models are a class of economic models that use actual economic data to estimate how an economy might react to changes in policy, technology or other external factors. CGE models are also referred to as AGE (applied general equilibrium) models. A CGE model consists of equations describing model variables and a database (usually very detailed) consistent with these model equations. The equations tend to be neoclassical in spirit, often assuming cost-minimizing behaviour by producers, average-cost pricing, and household demands based on optimizing behaviour.

CGE models are useful whenever we wish to estimate the effect of changes in one part of the economy upon the rest. They have been used widely to analyse trade policy. More recently, CGE has been a popular way to estimate the economic effects of measures to reduce greenhouse gas emissions.

#### Aggregate cost-benefit models

Integrated assessment models (IAMs) are also used to make aggregate estimates of the costs of climate change. These (cost-benefit) models balance the economic implications of mitigation and climate damages to identify the pathway of emissions reductions that will maximize total economic welfare.[20] In other words, the trade-offs between climate change impacts, adaptation, and mitigation are made explicit. The costs of each policy and the outcomes modelled are converted into monetary estimates.

The models incorporate aspects of the natural, social, and economic sciences in a highly aggregated way. Compared to other climate-economy models (including process-based IAMs), they do not have the structural detail necessary to model interactions with energy systems, land-use etc. and their economic implications.[20]

### Statistical (econometric) methods

See also: Econometric model

A third modelling approach uses empirical, statistical methods to investigate how the economy is affected by weather variation.[11]: 2495 [21]: 755 This approach can identify effects of temperature, rainfall, drought and storms on agriculture, energy demand, industry and other economic activity. Panel data of weather variation over time and space, e.g. from ground station observations or (interpolated) gridded data is aggregated for economic analysis to investigate effects on national economies.[21] These studies show that for example, hot years are linked to lower income growth in poor countries, and low rainfall is linked to reduced incomes in Africa.[21]: 755 Other econometric studies show that there are negative impacts of hotter temperatures on agricultural output, on labour productivity and in outdoor industries such as mining and forestry. The analyses are used to estimate the costs of climate change in the future.[21]

## Analytical frameworks

### Cost–benefit analysis

Standard cost–benefit analysis (CBA) has been applied to the problem of climate change. In a CBA framework, the negative and positive impacts associated with a given action are converted into monetary estimates.[22] This is also referred to as a monetized cost–benefit framework. Various types of model can provide information for CBA, including energy-economy-environment models (process models) that study energy systems and their transitions. Some of these models may include a physical model of the climate. Computable General Equilibrium (CGE) structural models investigate effects of policies (including climate policies) on economic growth, trade, employment, and public revenues. However, most CBA analyses are produced using aggregate integrated assessment models. These aggregate-type IAMs are particularly designed for doing CBA of climate change.[20]: 428 [23]: 238–239

The CBA framework requires (1) the valuation of costs and benefits using willingness to pay (WTP) or willingness to accept (WTA) compensation[24][25][26][27] as a measure of value,[28] and (2) a criterion for accepting or rejecting proposals:[28]

For (1), in CBA where WTP/WTA is used, climate change impacts are aggregated into a monetary value,[24] with environmental impacts converted into consumption equivalents,[29] and risk accounted for using certainty equivalents.[29][30] Values over time are then discounted to produce their equivalent present values.[31] The valuation of costs and benefits of climate change can be controversial[3]: 936–938 because some climate change impacts are difficult to assign a value to, e.g., ecosystems and human health.[32][33]

For (2), the standard criterion is the Kaldor–Hicks[34]: 3 compensation principle.[28] According to the compensation principle, so long as those benefiting from a particular project compensate the losers, and there is still something left over, then the result is an unambiguous gain in welfare.[28] If there are no mechanisms allowing compensation to be paid, then it is necessary to assign weights to particular individuals.[28] One of the mechanisms for compensation is impossible for this problem: mitigation might benefit future generations at the expense of current generations, but there is no way that future generations can compensate current generations for the costs of mitigation.[34]: 4 On the other hand, should future generations bear most of the costs of climate change, compensation to them would not be possible.[35]

CBA has several strengths: it offers an internally consistent and global comprehensive analysis of impacts.[3]: 955 Furthermore, sensitivity analysis allows critical assumptions in CBA analysis to be changed. This can identify areas where the value of information is highest and where additional research might have the highest payoffs.[36]: 119 However, there are many uncertainties that affect cost–benefit analysis, for example, sector- and country-specific damage functions.[37]: 654

#### Damage functions

This graph shows estimation confidence intervals from a meta-analysis of researchers as well as by the Stern Review in 2006 (damage costs measured as percent GDP).[needs update]

Damage functions play an important role in estimating the costs associated with potential damages caused by climate-related hazards. They quantify the relationship between the intensity of the hazard, other factors such as the vulnerability of the system, and the resulting damages. For example, damage functions have been developed for sea level rise, agricultural productivity, or heat effects on labour productivity.[38]

### Cost-effectiveness analysis

Cost-Effectiveness Analysis (CEA) is preferable to CBA when the benefits of impacts, adaptation and mitigation are difficult to estimate in monetary terms. A CEA can be used to compare different policy options for achieving a well-defined goal.[23]: 238 This goal (i.e. the benefit) is usually expressed as the amount of GHG emissions reduction in the analysis of mitigation measures. For adaptation measures, there is no common goal or metric for the economic benefits. Adaptation involves responding to different types of risks in different sectors and local contexts. For example, the goal might be the reduction of land area in hectares at risk to sea level rise.[39]: 2

CEA involves the costing of each option, providing a cost per unit of effectiveness. For example, cost per tonne of GHG reduced ($/tCO2). This allows the ranking of policy options. This ranking can help decision-maker to understand which are the most cost-effective options, i.e. those that deliver high benefits for low costs. CEA can be used for minimising net costs for achieving pre-defined policy targets, such as meeting an emissions reduction target for a given sector.[23]: 238 [39]: 2–3

CEA, like CBA, is a type of decision analysis method. Many of these methods work well when different stakeholders work together on a problem to understand and manage risks.[40]: 2543 For example, by discussing how well certain options might work in the real world. Or by helping in measuring the costs and benefits as part of a CEA.[40]: 2566, 2576

Some authors have focused on a disaggregated analysis of climate change impacts.[41]: 23 [42] "Disaggregated" refers to the choice to assess impacts in a variety of indicators or units, e.g., changes in agricultural yields and loss of biodiversity. By contrast, monetized CBA converts all impacts into a common unit (money), which is used to assess changes in social welfare.

Scaling the effect of wealth to the national level: richer (developed) countries emit more CO
2 per person than poorer (developing) countries.[43] Emissions are roughly proportional to GDP per person, though the rate of increase diminishes with an average GDP/pp of about $10,000.

### Scenario-based assessments

Main article: Earth:Climate change scenario

The long time scales and uncertainty when it comes to global warming have led analysts to develop "scenarios" of future environmental, social and economic changes.[44] These scenarios can help governments understand the potential consequences of their decisions.

The projected temperature in climate change scenarios is subject to scientific uncertainty (e.g., the relationship between concentrations of GHGs and global mean temperature, which is called the climate sensitivity). Projections of future atmospheric concentrations based on emission pathways are also affected by scientific uncertainties, e.g., over how carbon sinks, such as forests, will be affected by future climate change.

One of the economic aspects of climate change is producing scenarios of future economic development. Future economic developments can, for example, affect how vulnerable society is to future climate change,[45] what the future impacts of climate change might be, as well as the level of future GHG emissions.[46]

Scenarios are neither "predictions" nor "forecasts" but are stories of possible futures that provide alternate outcomes relevant to a decision-maker or other user.[40]: 2576 These alternatives usually also include a "baseline" or reference scenario for comparison. "Business-as-usual" scenarios have been developed in which there are no additional policies beyond those currently in place, and socio-economic development is consistent with recent trends. This term is now used less frequently than in the past.[22]

In scenario analysis, scenarios are developed that are based on differing assumptions of future development patterns.[44] An example of this are the shared socioeconomic pathways produced by the Intergovernmental Panel on Climate Change (IPCC). These project a wide range of possible future emissions levels.

Scenarios often support sector-specific analysis of the physical effects and economic costs of climate change. Scenarios are used with cost–benefit analysis or cost-effectiveness analysis of climate policies.

### Risk management

Main article: Finance:Climate risk

Risk management can be used to evaluate policy decisions based a range of criteria or viewpoints.[47]: 42 Another approach is that of uncertainty analysis,[44] where analysts attempt to estimate the probability of future changes in emission levels. Considerations in a risk-based approach might include, for example, the potential for low-probability, worst-case climate change impacts.[48]

In a cost-benefit analysis, an acceptable risk means that the benefits of a climate policy outweigh the costs of the policy.[49] The rule used by many decision makers is that a risk is acceptable if the anticipated net present value is positive.[49] The expected value is the mean of the distribution of expected outcomes.[50]: 25 In other words, it is the average expected outcome for a particular decision. This criterion has been justified under the conditions that:

* a policy's benefits and costs have known probabilities[49]
* economic agents (people and organizations) can reduce their risk through insurance and other markets.[49]

These assumptions are not often met, as it is challenging to estimate the costs of climate change, and that many benefits (like improved health) are not easily converted into monetary terms. Insurance is also not always an option, as climate disasters usually hit many people at once, making mutual aid difficult to implement.[49]

Policymakers and investors are beginning to recognize the implications of climate change for the financial sector, from both physical risks (damage to property, infrastructure, and land) and transition risk due to changes in policy, technology, and consumer and market behavior. Financial institutions are becoming increasingly aware of the need to incorporate the economics of low carbon emissions into business models.[51]

In the scientific literature, there is sometimes a focus on "best estimate" or "likely" values of climate sensitivity.[52] However, from a risk management perspective, values outside of "likely" ranges are relevant, because, though these values are less probable, they could be associated with more severe climate impacts[53] (the statistical definition of risk = probability of an impact × magnitude of the impact).[54]: 208

Analysts have also looked at how uncertainty over climate sensitivity affects economic estimates of climate change impacts.[55] Policy guidance from cost-benefit analysis (CBA) can be extremely divergent depending on the assumptions employed.[56] Hassler et al use integrated assessment modeling to examine a range of estimates and what happens at extremes.[57]

#### Iterative risk management

Two related ways of thinking about the problem of climate change decision-making in the presence of uncertainty are iterative risk management[58][54] and sequential decision making.[59]: 612–614 One of the responses to the uncertainties of global warming is to adopt a strategy of sequential decision making.[60] This involves making a series of observations before making a final decision.[61]

An approach based on sequential decision making recognizes that, over time, decisions related to climate change can be revised in the light of improved information.[60] This is particularly important with respect to climate change, due to the long-term nature of the problem. A near-term hedging strategy concerned with reducing future climate impacts might favor stringent, near-term emissions reductions.[59] As stated earlier, carbon dioxide accumulates in the atmosphere, and to stabilize the atmospheric concentration of CO
2, emissions would need to be drastically reduced from their present level. Stringent near-term emissions reductions allow for greater future flexibility with regard to a low stabilization target, e.g., 450 parts per million (ppm) CO
2. This option may be lost if near-term emissions abatement is less stringent.[62]

Another way of viewing the problem is to look at the potential irreversibility of future climate change impacts (e.g., damages to biomes and ecosystems) against the irreversibility of making investments in efforts to reduce emissions.[60]

#### Portfolio analysis

One risk management framework is portfolio analysis. This approach is based on portfolio theory, originally applied in the areas of finance and investment.[63][64] The idea is that a reasonable response to uncertainty is to invest in a wide portfolio of options to spread risk.[63] It is important to compare alternative portfolios of options across different future climate change scenarios in order to take into account uncertainty in climate impacts, GHG emission trends etc. The options should ideally be diversified to be effective in different scenarios: i.e. some options suited for a no/low climate change scenario, with other options being suited for scenarios with severe climate changes.[64]

## Costs of climate impacts

### At the global level

File:2020- Climate change's projected damage to GDP growth.svgEstimates of damage to GDP vary widely, and even this approach to predicting damage does not consider impacts of climate tipping points, climate-driven extreme events, human health impacts, resource or migration-driven conflict, geopolitical tension, nature-driven risks, or sea level rise.[65] There is a growing number of weather-related disasters in the United States costing above one billion dollars[66][67]

Global aggregate costs are all the predicted impacts of climate change across all market sectors (e.g. including costs to agriculture, energy services and tourism) and also includes non-market impacts (e.g. on ecosystems and human health).[11]: 2495

Estimates are found to increase non-linearly with global average temperature change. The 2022 IPCC report finds that with high warming (~4 °C) and low adaptation, annual global GDP might be reduced by 10–23% by 2100 because of climate change. The same assessment finds smaller GDP changes with reductions of 1–8%, assuming low warming, more adaptation, and using different models. These estimates do not take into account climate tipping points well.[11]: 2459 In addition, these global economic cost estimates do not take into account impacts on social well-being or welfare or distributional effects.[11]: 2495

Climate damages estimated statistically usually only look only how national weather variations impact GDP. A 2025 study explored adding global weather changes into the statistical analysis, given the trade between countries and how strongly one economy depends on another. This raised the estimates of climate damages from 11% to 40% in 2100 under a very high emission scenario.[68]

Another study, which checked the data from the last 120 years, found that climate change has already reduced welfare by 29% and further temperature rise will bring this number to 47%. The temperature rise between 1960 and 2019 cut current GDP per person by 18%. A rise by 1 degree in global temperature reduces global GDP by 12%. An increase of 3 degrees by 2100, will reduce capital by 50%. The effects are like experiencing the 1929 Great Depression permanently. The associated social cost of carbon is 1065 dollars per tonne of CO2.[69][70]

Global economic losses due to extreme weather, climate and water events are increasing. Costs have increased sevenfold from the 1970s to the 2010s.[71]: 16 Direct losses from disasters have averaged above US$330 billion annually between 2015 and 2021.[72]: 21 Climate change has contributed to the increased probability and magnitude of extreme events. When a vulnerable community is exposed to extreme climate or weather events, disasters can occur. Socio-economic factors have contributed to the observed trend of global disaster losses, such as population growth and increased wealth.[73] This shows that increased exposure is the most important driver of losses. However, part of these are also due to human-induced climate change. Extreme event attribution quantifies how climate change is altering the probability and magnitude of extreme events. On a case-by-case basis, it is feasible to estimate how the magnitude and/or probability of the extreme event has shifted due to climate change. These attributable changes have been identified for many individual extreme heat events and rainfall events.[74]: 1611 [75] Using all available data on attributable changes, one study estimated the global losses to average US$143 billion per year between 2000 and 2019. This includes a statistical loss of life value of 90 billion and economic damages of 53 billion per year.[75]

One 2020 study estimated economic losses due to climate change could be between 127 and 616 trillion dollars extra until 2100 with current commitments, compared to 1.5 °C or well below 2 °C compatible action. Failure to implement current commitments raises economic losses to 150–792 trillion dollars until 2100.[76] A 2026 study published in Nature estimated that, from 1990 through 2020, carbon dioxide emissions in the US caused $10.2 trillion in cumulative damages by 2020, with about 30% occurring within the US itself.[77] Damages from China were estimated at $8.7 trillion, and from the EU, $6.42 trillion.[77] The researchers said that future damages from past emissions are at least an order of magnitude larger than historical damages from the same emissions.[77]

Economic impacts also include inflation from rising insurance premiums,[78][79] energy costs and food prices.[78][80][81] Overall impacts of inflation range from 0.32 to 1.18 percentage points per year, depending on the socio-economic future and future emissions. That is, if a country's inflation without climate change would be 2.0%, it could raise to 2.3% to 3.2% per year with climate change. For food inflation, the estimate ranges between 0.92 to 3.23 percentage points.[4]

#### High emissions scenarios

The total economic impacts from climate change increase for higher temperature changes.[2] For instance, total damages are estimated to be 90% less if global warming is limited to 1.5 °C compared to 3.66 °C, a warming level chosen to represent no mitigation.[82] In an Oxford Economics study high emission scenario, a temperature rise of 2 degrees by the year 2050 would reduce global GDP by 2.5–7.5%. By the year 2100 in this case, the temperature would rise by 4 degrees, which could reduce the global GDP by 30% in the worst case.[83]

One 2018 study found that potential global economic gains if countries implement mitigation strategies to comply with the 2 °C target set at the Paris Agreement are in the vicinity of US$17 trillion per year up to 2100, compared to a very high emission scenario.[84]

### Underestimation of economic impacts

The amount by which greenhouse gas emissions are reduced is forecast to substantially affect the number of Winter Olympic Game venues that will have reliably snowy conditions.[85]

File:20260201 Reliability of venues for snow - Winter Olympics.svg

Though Europe and North America have the most potential venues for Olympic Winter Games, a higher portion of those venues are projected to be climatically unreliable because of global warming.[86]

Studies in 2019 suggested that economic damages due to climate change have been underestimated, and may be severe, with the probability of disastrous tail-risk events.[87][88]

Tipping points are critical thresholds that, when crossed, lead to large, accelerating and often irreversible changes in the climate system. The science of tipping points is complex and there is great uncertainty as to how they might unfold.[89] Economic analyses often exclude the potential effect of tipping points. A 2018 study noted that the global economic impact is underestimated by a factor of two to eight, when tipping points are excluded from consideration.[82]

The Stern Review from 2006 for the British Government predicted that world GDP would be reduced by several percent due to climate related costs. However, their calculations may omit ecological effects that are difficult to quantify economically (such as human deaths or loss of biodiversity) or whose economic consequences will manifest slowly.[90] Therefore, their calculations may be an underestimate. The study has received both criticism and support from other economists.

### By region

Other studies investigate economic losses by GDP change per country or by per country per capita. Findings show large differences among countries and within countries. The estimated GDP changes in some developing countries are similar to some of the worst country-level losses during historical economic recessions.[11]: 2459 Economic losses are risks to living standards, which are more likely to be severe in developing countries. Climate change can push more people into extreme poverty or keep people poor, especially through particularly climate-sensitive sectors such as agriculture and fisheries. Climate change may also increase income inequality within countries as well as between them, particularly affecting low-income groups.[11]: 2461

According to a study by reinsurance company Swiss Re in 2021 the economies of wealthy countries like the US would likely shrink by approximately 7%, while some developing nations would be devastated, losing around 20% or in some cases 40% of their economic output.[91]

A United States government report in November 2018 raised the possibility of US GDP going down 10% as a result of the warming climate, including huge shifts in geography, demographics and technology.[92]

### By sector

The distribution of warming impacts from emitters has been unequal, with high-income, high-emitting countries benefitting while harming low-income, low-emitting countries.[93]

A number of economic sectors will be affected by climate change, including the livestock, forestry, and fisheries industries. Other sectors sensitive to climate change include the energy, insurance, tourism and recreation industries.[11]: 2496

#### Health and productivity

Among the health impacts that have been studied, aggregate costs of heat stress (through loss of work time) have been estimated, as have the costs of malnutrition.[94]: 1074–5 However, it is usual for studies to aggregate the number of 'years of life lost' adjusted for years living with disability to measure effects on health.[94]: 1060

In 2019 the International Labour Organization published a report titled: "Working on a warmer planet: The impact of heat stress on labour productivity and decent work", in which it claims that even if the rise in temperature will be limited to 1.5 degree, by the year 2030, Climate Change will cause losses in productivity reaching 2.2% of all the working hours, every year. This is equivalent to 80 million full-time jobs, or 2,400 billion dollars. The sector expected to be most affected is agriculture, which is projected to account for 60% of this loss. The construction sector is also projected to be severely impacted and accounts for 19% of projected losses. Other sectors that are most at risk are environmental goods and services, refuse collection, emergency, repair work, transport, tourism, sports and some forms of industrial work.[95][96]

It has been estimated that 3.5 million people die prematurely each year from air pollution from fossil fuels.[97] The health benefits of meeting climate goals substantially outweigh the costs of action.[98] The health benefits of phasing out fossil fuels measured in money (estimated by economists using the value of life for each country) are substantially more than the cost of achieving the 2 degree C goal of the Paris Agreement.[99]

#### Agriculture

This section is an excerpt from Effects of climate change on agriculture#Labour and economic effects[ edit ]

#### Industry

Carbon-intensive industries and investors are expected to experience a significant increase in stranded assets[100] with a potential ripple effect throughout the world economy.[13][14]

### Impacts on living costs

The effects of climate change contribute to inflation due to additional costs.[101][102][81] For example, food prices could rise by as much as 3% per year due to climate change impacts.[103][104][81] Climate change was one of the factors involved in the world food crises (2022–2023), which led to higher food prices.

Natural disasters fueled by climate change have increased housing costs through insurance[79][78] and by exacerbating housing shortages when those events make homes unlivable.[105]

### Utility of aggregated assessment

File:Projected economic impact of 2°C global warming on Senegal, OWID.pngProjected economic impacts of 2 degrees of global warming on Senegal

There are a number of benefits of using aggregated assessments to measure economic impacts of climate change.[3]: 954 They allow impacts to be directly compared between different regions and times. Impacts can be compared with other environmental problems and also with the costs of avoiding those impacts. A problem of aggregated analyses is that they often reduce different types of impacts into a small number of indicators. It can be argued that some impacts are not well-suited to this, e.g., the monetization of mortality and loss of species diversity. On the other hand, where there are monetary costs of avoiding impacts, it may not be possible to avoid monetary valuation of those impacts.[106]: 364

## Costs of mitigation

Climate change mitigation consist of human actions to reduce greenhouse gas emissions or to enhance carbon sinks that absorb greenhouse gases from the atmosphere.[107]: 2239

A study published in 2024 showed that keeping global warming below 2 °C may cost about 1% of world GDP each year, but could prevent much larger losses of 10–20% of GDP by mid century.[108]

This section is an excerpt from Climate change mitigation § Costs and funding[ edit ]

### Global costs of mitigation

Mitigation cost estimates depend critically on the baseline (in this case, a reference scenario that the alternative scenario is compared with), the way costs are modelled, and assumptions about future government policy.[109]: 622 Macroeconomic costs in 2030 were estimated for multi-gas mitigation (reducing emissions of carbon dioxide and other GHGs, such as methane) as between a 3% decrease in global GDP to a small increase, relative to baseline.[110] This was for an emissions pathway consistent with atmospheric stabilization of GHGs between 445 and 710 ppm CO2-eq. In 2050, the estimated costs for stabilization between 710 and 445 ppm CO2-eq ranged between a 1% gain to a 5.5% decrease in global GDP, relative to baseline. These cost estimates were supported by a moderate amount of evidence and much agreement in the literature.[111]: 11, 18

Macroeconomic cost estimates were mostly based on models that assumed transparent markets, no transaction costs, and perfect implementation of cost-effective policy measures across all regions throughout the 21st century.[110]: 204 Relaxation of some or all these assumptions would lead to an appreciable increase in cost estimates. On the other hand, cost estimates could be reduced by allowing for accelerated technological learning, or the possible use of carbon tax/emission permit revenues to reform national tax systems.[111]: 8

In most of the assessed studies, costs rose for increasingly stringent stabilization targets. In scenarios that had high baseline emissions, mitigation costs were generally higher for comparable stabilization targets. In scenarios with low emissions baselines, mitigation costs were generally lower for comparable stabilization targets.

This pie chart illustrates both total emissions for each income group, and emissions per person within each income group. For example, the 10% with the highest incomes are responsible for half of carbon emissions, and its members emit an average of more than five times as much per person as members of the lowest half of the income scale.[112]

### Regional costs of mitigation

Several studies have estimated regional mitigation costs. The conclusions of these studies are as follows:[113]: 776

* Regional abatement costs are largely dependent on the assumed stabilization level and baseline scenario. The allocation of emission allowances/permits is also an important factor, but for most countries, is less important than the stabilization level.
* Other costs arise from changes in international trade. Fossil fuel-exporting regions are likely to be affected by losses in coal and oil exports compared to baseline, while some regions might experience increased bio-energy (energy derived from biomass) exports.
* Allocation schemes based on current emissions (i.e., where the most allowances/permits are given to the largest current polluters, and the fewest allowances are given to smallest current polluters) lead to welfare losses for developing countries, while allocation schemes based on a per capita convergence of emissions (i.e., where per capita emissions are equalized) lead to welfare gains for developing countries.

### Sharing of mitigation costs

There have been different proposals on how to allocate responsibility for cutting emissions:[114]: 103

* Egalitarianism: this system interprets the problem as one where each person has equal rights to a global resource, i.e., polluting the atmosphere.
* Basic needs: this system would have emissions allocated according to basic needs, as defined according to a minimum level of consumption. Consumption above basic needs would require countries to buy more emission rights. From this viewpoint, developing countries would need to be at least as well off under an emissions control regime as they would be outside the regime.
* Proportionality and polluter-pays principle: Proportionality reflects the ancient Aristotelian principle that people should receive in proportion to what they put in, and pay in proportion to the damages they cause. This has a potential relationship with the "polluter-pays principle", which can be interpreted in a number of ways:
* Historical responsibilities: this asserts that allocation of emission rights should be based on patterns of past emissions. Two-thirds of the stock of GHGs in the atmosphere at present is due to the past actions of developed countries.[115]: 29
* Comparable burdens and ability to pay: with this approach, countries would reduce emissions based on comparable burdens and their ability to take on the costs of reduction. Ways to assess burdens include monetary costs per head of population, as well as other, more complex measures, like the UNDP's Human Development Index.
* Willingness to pay: with this approach, countries take on emission reductions based on their ability to pay along with how much they benefit[116] from reducing their emissions.
* Equal per capita entitlements: this is the most widely cited method of distributing abatement costs, and is derived from egalitarianism.[114]: 106 This approach can be divided into two categories. In the first category, emissions are allocated according to national population. In the second category, emissions are allocated in a way that attempts to account for historical (cumulative) emissions.
* Status quo: with this approach, historical emissions are ignored, and current emission levels are taken as a status quo right to emit.[114]: 107 An analogy for this approach can be made with fisheries, which is a common, limited resource. The analogy would be with the atmosphere, which can be viewed as an exhaustible natural resource.[115]: 27 In international law, one state recognized the long-established use of another state's use of the fisheries resource. It was also recognized by the state that part of the other state's economy was dependent on that resource.

## Costs of adaptation

This section is an excerpt from Climate finance § Adaptation costs and adaptation financing needs[ edit ]

## Challenges and debates

### Efficiency and equity

No consensus exists on who should bear the burden of adaptation and mitigation costs.[50]: 29 Several different arguments have been made over how to spread the costs and benefits of taxes or systems based on emissions trading.

One approach considers the problem from the perspective of who benefits most from the public good. This approach is sensitive to the fact that different preferences exist between different income classes. The public good is viewed in a similar way as a private good, where those who use the public good must pay for it. Some people will benefit more from the public good than others, thus creating inequalities in the absence of benefit taxes. A difficulty with public goods is determining who exactly benefits from the public good, although some estimates of the distribution of the costs and benefits of global warming have been made – see above. Additionally, this approach does not provide guidance as to how the surplus of benefits from climate policy should be shared.

A second approach has been suggested based on economics and the social welfare function. To calculate the social welfare function requires an aggregation of the impacts of climate change policies and climate change itself across all affected individuals. This calculation involves a number of complexities and controversial equity issues.[25]: 460 For example, the monetization of certain impacts on human health. There is also controversy over the issue of benefits affecting one individual offsetting negative impacts on another.[3] : 958 These issues to do with equity and aggregation cannot be fully resolved by economics.[117]: 87

On a utilitarian basis, which has traditionally been used in welfare economics, an argument can be made for richer countries taking on most of the burdens of mitigation.[118] However, another result is possible with a different modeling of impacts. If an approach is taken where the interests of poorer people have lower weighting, the result is that there is a much weaker argument in favour of mitigation action in rich countries. Valuing climate change impacts in poorer countries less than domestic climate change impacts (both in terms of policy and the impacts of climate change) would be consistent with observed spending in rich countries on foreign aid[119][120]: 229

A third approach looks at the problem from the perspective of who has contributed most to the problem. Because the industrialized countries have contributed more than two-thirds of the stock of human-induced GHGs in the atmosphere, this approach suggests that they should bear the largest share of the costs. This stock of emissions has been described as an "environmental debt".[121]: 167 In terms of efficiency, this view is not supported. This is because efficiency requires incentives to be forward-looking, and not retrospective.[50]: 29 The question of historical responsibility is a matter of ethics. It has been suggested that developed countries could address the issue by making side-payments to developing countries.[121]: 167

A 2019 modelling study found climate change had contributed towards global economic inequality. Wealthy countries in colder regions had either felt little overall economic impact from climate change, or possibly benefited, whereas poor hotter countries very likely grew less than if global warming had not occurred.[122] Part of this observation stems from the fact that greenhouse gas emissions come mainly from high-income countries, while low-income countries are affected by it negatively.[123] So, high-income countries are producing significant amounts of emissions, but the impacts are unequally threatening low-income countries, who do not have access to the resources to recover from such impacts. This further deepens the inequalities within the poor and the rich, hindering sustainability efforts. Impacts of climate change could even push millions of people into poverty.[124]

### Insurance and markets

Traditional insurance works by transferring risk to those better able or more willing to bear risk, and also by the pooling of risk.[50]: 25 Since the risks of climate change are, to some extent, correlated, this reduces the effectiveness of pooling. However, there is reason to believe that different regions will be affected differently by climate change. This suggests that pooling might be effective. Since developing countries appear to be potentially most at risk from the effects of climate change, developed countries could provide insurance against these risks.[125]

Disease, rising seas, reduced crop yields, and other harms driven by climate change will likely have a major deleterious impact on the economy by 2050 unless the world sharply reduces greenhouse gas emissions in the near term, according to a number of studies, including a study by the Carbon Disclosure Project and a study by insurance giant Swiss Re. The Swiss Re assessment found that annual output by the world economy will be reduced by $23 trillion annually, unless greenhouse gas emissions are adequately mitigated. As a consequence, according to the Swiss Re study, climate change will impact how the insurance industry prices a variety of risks.[91][126][127]

### Effects of economic growth and degrowth scenarios on emissions

The emissions of the richest 1% of the global population account for more than twice the combined share of the poorest 50%. Compliance with the 1.5 °C goal of the Paris Agreement would require the richest 1% to reduce their current emissions by at least a factor of 30, while per-person emissions of the poorest 50% could increase by a factor of about three.[128] Though total CO
2 emissions (size of pie charts) differ substantially among high-emitting regions, the pattern of higher income classes emitting more than lower income classes is consistent across regions.[129] The world's top 1% of emitters emit over 1000 times more than the bottom 1%.[129]

See also: Degrowth, Eco-economic decoupling, and Ecological economics

Economic growth is one of the causes of increasing greenhouse gas emissions.[130][131] As the economy expands, demand for energy and energy-intensive goods increases, pushing up CO2 emissions. On the other hand, economic growth may drive technological change and increase energy efficiency. Economic growth may be associated with specialization in certain economic sectors. If specialization is in energy-intensive sectors, then there will be a strong link between economic growth and emissions growth. If specialization is in less energy-intensive sectors, e.g. the services sector, then there might be a weak link between economic growth and emissions growth. In general, there is some degree of flexibility between economic growth and emissions growth.[132]

Some studies found that degrowth scenarios, where economic output either declines or declines in terms of contemporary economic metrics such as current GDP, have been neglected in considerations of 1.5 °C scenarios reported by the Intergovernmental Panel on Climate Change (IPCC). They find that some degrowth scenarios "minimize many key risks for feasibility and sustainability compared to technology-driven pathways" with a core problem of such being feasibility in the context of contemporary decision-making of politics and globalized rebound- and relocation-effects.[133][134] This is supported by other studies which state that absolute decoupling is highly unlikely to be achieved fast enough to prevent global warming over 1.5 °C or 2 °C, even under optimistic policy conditions.[135]

## Economics of climate change mitigation

Companies, governments and households have committed increasing amounts to decarbonization, including renewable energy (solar, wind), electric vehicles and associated charging infrastructure, energy storage, energy-efficient heating systems, carbon capture and storage, and hydrogen.[136][137][138][139][140] Part of a series on

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The economics of climate change mitigation is a contentious part of climate change mitigation – action aimed to limit the dangerous socio-economic and environmental consequences of climate change.[110] Climate change mitigation centres on two main strategies: the reduction of greenhouse gas (GHG) emissions and the preservation and expansion of sinks which absorb greenhouse gases, including the sea and forests.

### Policies and approaches to reduce emissions

Main article: Earth:Climate change mitigation

#### Price signals

A carbon price is a system of applying a price to carbon emissions, as a method of emissions mitigation.[141] Potential methods of pricing include carbon emission trading, results-based climate finance, crediting mechanisms and more.[142] Carbon pricing can lend itself to the creation of carbon taxes, which allows governments to tax emissions.[141]

Carbon taxes are considered useful because, once a number[clarification needed] has been created, it will benefit the government either with currency or with a lowering in emissions or both, and therefore benefit the environment.[143] It is almost a consensus that carbon taxing is the most cost-effective method of having a substantial and rapid response to climate change and carbon emissions.[144] However, backlash to the tax includes that it can be considered regressive, as the impact can be damaging disproportionately to the poor who spend much of their income on energy for their homes.[145] Still, even with near universal approval, there are issues regarding both the collection and redistribution of the taxes. One of the central questions being how the newly collected taxes will be redistributed.[146]

Some or all of the proceeds of a carbon tax can be used to stop it disadvantaging the poor.[147]

#### Structural market reforms

See also: Earth:Emissions trading

In addition to the implementation of command-and-control regulations (as with a carbon tax), governments can also use market-based approaches to mitigate emissions. One such method is emissions trading where governments set the total emissions of all polluters to a maximum and distribute permits, through auction or allocation, that allow entities to emit a portion, typically one ton of carbon dioxide equivalent (CO2e), of the mandated total emissions.[148] In other words, the amount of pollution an entity can emit in an emissions trading system is limited by the number of permits they have. If a polluter wants to increase their emissions, they can only do so after buying permits from those who are willing to sell them.[143] Many economists prefer this method of reducing emissions as it is market based and highly cost effective.[148] That being said, emissions trading alone is not perfect since it fails to place a clear price on emissions. Without this price, emissions prices are volatile due to the supply of permits being fixed, meaning their price is entirely determined by shifts in demand.[149] This uncertainty in price is especially disliked by businesses since it prevents them from investing in abatement technologies with confidence which hinders efforts for mitigating emissions.[149] Regardless, while emissions trading alone has its problems and cannot reduce pollutants to the point of stabilizing the global climate, it remains an important tool for addressing climate change.

#### Degrowth

There is a debate about a potentially critical need for new ways of economic accounting, including directly monitoring and quantifying positive real-world environmental effects such as air quality improvements and related unprofitable work like forest protection, alongside far-reaching structural changes of lifestyles[131][150] as well as acknowledging and moving beyond the limits of current economics such as GDP.[151] Some argue that for effective climate change mitigation degrowth has to occur, while some argue that eco-economic decoupling could limit climate change enough while continuing high rates of traditional GDP growth.[152][153] There is also research and debate about requirements of how economic systems could be transformed for sustainability – such as how their jobs could transition harmoniously into green jobs – a just transition – and how relevant sectors of the economy – like the renewable energy industry and the bioeconomy – could be adequately supported.[154][155]

While degrowth is often believed to be associated with decreased living standards and austerity measures, many of its proponents seek to expand universal public goods[156][157] (such as public transport), increase health[158][159][160] (fitness, wellbeing[161] and freedom from diseases) and increase various forms of, often unconventional commons-oriented,[162] labor. To this end, the application of both advanced technologies and reductions in various demands, including via overall reduced labor time[163] or sufficiency-oriented strategies,[164] are considered to be important by some.[165][166]

### Assessing costs and benefits

#### GDP

The costs of mitigation and adaptation policies can be measured as a percentage of GDP. A problem with this method of assessing costs is that GDP is an imperfect measure of welfare.[167]: 478 There are externalities in the economy which mean that some prices might not be truly reflective of their social costs.

Corrections can be made to GDP estimates to allow for these problems, but they are difficult to calculate. In response to this problem, some have suggested using other methods to assess policy. For example, the United Nations Commission for Sustainable Development has developed a system for "Green" GDP accounting and a list of sustainable development indicators.

#### Baselines

The emissions baseline is, by definition, the emissions that would occur in the absence of policy intervention. Definition of the baseline scenario is critical in the assessment of mitigation costs.[167]: 469 This because the baseline determines the potential for emissions reductions, and the costs of implementing emission reduction policies.

There are several concepts used in the literature over baselines, including the "efficient" and "business-as-usual" (BAU) baseline cases. In the efficient baseline, it is assumed that all resources are being employed efficiently. In the BAU case, it is assumed that future development trends follow those of the past, and no changes in policies will take place. The BAU baseline is often associated with high GHG emissions, and may reflect the continuation of current energy-subsidy policies, or other market failures.

Some high emission BAU baselines imply relatively low net mitigation costs per unit of emissions. If the BAU scenario projects a large growth in emissions, total mitigation costs can be relatively high. Conversely, in an efficient baseline, mitigation costs per unit of emissions can be relatively high, but total mitigation costs low.[clarification needed]

#### Ancillary impacts

These are the secondary or side effects of mitigation policies, and including them in studies can result in higher or lower mitigation cost estimates.[167]: 455 Reduced mortality and morbidity costs are potentially a major ancillary benefit of mitigation. This benefit is associated with reduced use of fossil fuels, thereby resulting in less air pollution, which might even just by itself be a benefit greater than the cost.[168]: 48 There may also be ancillary costs.

#### Flexibility

Flexibility is the ability to reduce emissions at the lowest cost. The greater the flexibility that governments allow in their regulatory framework to reduce emissions, the lower the potential costs are for achieving emissions reductions (Markandya et al., 2001:455).[167]

* "Where" flexibility allows costs to be reduced by allowing emissions to be cut at locations where it is most efficient to do so. For example, the Flexibility Mechanisms of the Kyoto Protocol allow "where" flexibility (Toth et al., 2001:660).[169]
* "When" flexibility potentially lowers costs by allowing reductions to be made at a time when it is most efficient to do so.

Including carbon sinks in a policy framework is another source of flexibility. Tree planting and forestry management actions can increase the capacity of sinks. Soils and other types of vegetation are also potential sinks. There is, however, uncertainty over how net emissions are affected by activities in this area.[167][clarification needed]

#### Discount rates

See also: Discounting and Social discount rate

Assessing climate change impacts and mitigation policies involves a comparison of economic flows that occur in different points in time. The discount rate is used by economists to compare economic effects occurring at different times. Discounting converts future economic impacts into their present-day value. The discount rate is generally positive because resources invested today can, on average, be transformed into more resources later. If climate change mitigation is viewed as an investment, then the return on investment can be used to decide how much should be spent on mitigation.

Integrated assessment models (IAM) are used to estimate the social cost of carbon. The discount rate is one of the factors used in these models. The IAM frequently used is the Dynamic Integrated Climate-Economy (DICE) model developed by William Nordhaus. The DICE model uses discount rates, uncertainty, and risks to make benefit and cost estimations of climate policies and adapt to the current economic behavior.[170]

The choice of discount rate has a large effect on the result of any climate change cost analysis (Halsnæs et al., 2007:136).[171] Using too high a discount rate will result in too little investment in mitigation, but using too low a rate will result in too much investment in mitigation. In other words, a high discount rate implies that the present-value of a dollar is worth more than the future-value of a dollar.

Discounting can either be prescriptive or descriptive. The descriptive approach is based on what discount rates are observed in the behaviour of people making every day decisions (the private discount rate) (IPCC, 2007c:813).[172] In the prescriptive approach, a discount rate is chosen based on what is thought to be in the best interests of future generations (the social discount rate).

The descriptive approach can be interpreted[clarification needed] as an effort to maximize the economic resources available to future generations, allowing them to decide how to use those resources (Arrow et al., 1996b:133–134).[173] The prescriptive approach can be interpreted as an effort to do as much as is economically justified[clarification needed] to reduce the risk of climate change.

The DICE model incorporates a descriptive approach, in which discounting reflects actual economic conditions. In a recent[when?] DICE model, DICE-2013R Model, the social cost of carbon is estimated based on the following alternative scenarios: (1) a baseline scenario, when climate change policies have not changed since 2010, (2) an optimal scenario, when climate change policies are optimal (fully implemented and followed), (3) when the optimal scenario does not exceed 2˚C limit after 1900 data, (4) when the 2˚C limit is an average and not the optimum, (5) when a near-zero (low) discount rate of 0.1% is used (as assumed in the Stern Review), (6) when a near-zero discount rate is also used but with calibrated interest rates, and (7) when a high discount rate of 3.5% is used.[174][needs update]

According to Markandya et al. (2001:466), discount rates used in assessing mitigation programmes need to at least partly reflect the opportunity costs of capital.[167] In developed countries, Markandya et al. (2001:466) thought that a discount rate of around 4–6% was probably justified, while in developing countries, a rate of 10–12% was cited. The discount rates used in assessing private projects were found to be higher – with potential rates of between 10% and 25%.

When deciding how to discount future climate change impacts, value judgements are necessary (Arrow et al., 1996b:130). IPCC (2001a:9) found that there was no consensus on the use of long-term discount rates in this area.[175] The prescriptive approach to discounting leads to long-term discount rates of 2–3% in real terms, while the descriptive approach leads to rates of at least 4% after tax – sometimes much higher (Halsnæs et al., 2007:136).

Even today, it is difficult to agree on an appropriate discount rate. The approach of discounting to be either prescriptive or descriptive stemmed from the views of Nordhaus and Stern. Nordhaus takes on a descriptive approach which "assumes that investments to slow climate change must compete with investments in other areas". While Stern takes on a prescriptive approach in which "leads to the conclusion that any positive pure rate of time preference is unethical".[170]

In Nordhaus' view, his descriptive approach translates that the impact of climate change is slow, thus investments in climate change should be on the same level of competition with other investments. He defines the discount rate to be the rate of return on capital investments. The DICE model uses the estimated market return on capital as the discount rate, around an average of 4%. He argues that a higher discount rate will make future damages look small, thus have less effort to reduce emissions today. A lower discount rate will make future damages look larger, thus put more effort to reduce emissions today.[176]

In Stern's view, the pure rate of time preference is defined as the discount rate in a scenario where present and future generations have equal resources and opportunities.[177] A zero pure rate of time preference in this case would indicate that all generations are treated equally. The future generation do not have a "voice" on today's current policies, so the present generation are morally responsible to treat the future generation in the same manner. He suggests for a lower discount rate in which the present generation should invest in the future to reduce the risks of climate change.

Assumptions are made to support estimating high and low discount rates. These estimates depend on future emissions, climate sensitivity relative to increase in greenhouse gas concentrations, and the seriousness of impacts over time.[178] Long-term climate policies will significantly impact future generations and this is called intergenerational discounting. Factors that make intergenerational discounting complicated include the great uncertainty of economic growth, future generations are affected by today's policies, and private discounting will be affected due to a longer "investment horizon".[179]

Discounting is a relatively controversial issue in both climate change mitigation and environmental economics due to the ethical implications of valuing future generations less than present ones. Non-economists often find it difficult to grapple with the idea that thousands of dollars of future costs and benefits can be valued at less than a cent in the present after discounting.[180]

### Economic barriers to addressing climate change mitigation

Economic components like the stock market underestimate or cannot value social benefits of climate change mitigation.[181] Climate change is largely an externality,[182][183][184] despite a limited recent internalization of impacts that previously were fully 'external' to the economy.[185]

Consumers can be affected by policies that relate to e.g. ethical consumer literacy,[186] the available choices they have, transportation policy,[187] product transparency policies,[188][189][190][191] and larger-order economic policies that for example facilitate large-scale shifts of jobs.[154][155] Such policies or measures are sometimes unpopular with the population. Therefore, they may be difficult for politicians to enact directly or help facilitate indirectly.

Climate policies-induced future lost financial profits from global stranded fossil-fuel assets would lead to major losses for freely managed wealth of investors in advanced economies in current economics.[192]

## See also

* Circular economy
* Climate change and poverty
* Climate justice
* Climate security
* Ecological economics
* Effects of climate change on agriculture
* Effects of climate change on livestock
* Energy transition
* Environmental economics
* Environmental justice
* European Green Deal
* Green economy

## References

1. ↑ Wang, Zheng; Wu, Jing; Liu, Changxin; Gu, Gaoxiang (2017). Integrated Assessment Models of Climate Change Economics. Singapore: Springer Singapore. doi:10.1007/978-981-10-3945-4. ISBN 978-981-10-3943-0.
2. ↑ 2.0 2.1 IPCC (2014). "Summary for Policymakers". IPCC AR5 WG2 A 2014. p. 12. https://archive.ipcc.ch/pdf/assessment-report/ar5/wg2/ar5_wgII_spm_en.pdf. Retrieved 15 February 2020.
3. ↑ 3.0 3.1 3.2 3.3 3.4 "19. Vulnerability to Climate Change and Reasons for Concern: A Synthesis". Climate Change 2001: Impacts, Adaptation and Vulnerability. Contribution of Working Group II to the Third Assessment Report of the Intergovernmental Panel on Climate Change. Cambridge, UK, and New York, N.Y.: Cambridge University Press. 2001. pp. 913–970. https://www.ipcc.ch/site/assets/uploads/2018/03/wg2TARchap19.pdf. Retrieved 19 January 2022.
4. ↑ 4.0 4.1 Kotz, Maximilian; Kuik, Friderike; Lis, Eliza; Nickel, Christiane (2024). "Global warming and heat extremes to enhance inflationary pressures" (in en). Communications Earth & Environment 5 (1): 116. doi:10.1038/s43247-023-01173-x. ISSN 2662-4435. Bibcode: 2024ComEE...5..116K. https://www.nature.com/articles/s43247-023-01173-x.
5. ↑ Vuong, Q.-H. (2021). "The semiconducting principle of monetary and environmental values exchange". Economics and Business Letters 10 (3): 284–290. doi:10.17811/ebl.10.3.2021.284-290. https://reunido.uniovi.es/index.php/EBL/article/view/15872.
6. ↑ Stern, N. (2006). Stern Review on the Economics of Climate Change: Part III: The Economics of Stabilisation. HM Treasury, London: http://hm-treasury.gov.uk/sternreview_index.htm
7. ↑ Sampedro, Jon; Smith, Steven J.; Arto, Iñaki; González-Eguino, Mikel; Markandya, Anil; Mulvaney, Kathleen M.; Pizarro-Irizar, Cristina; Van Dingenen, Rita (2020). "Health co-benefits and mitigation costs as per the Paris Agreement under different technological pathways for energy supply" (in en). Environment International 136. doi:10.1016/j.envint.2020.105513. PMID 32006762. Bibcode: 2020EnInt.13605513S.
8. ↑ IPCC, 2007: Technical Summary – Climate Change 2007: Mitigation. Contribution of Working Group III to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change [B. Metz, O.R. Davidson, P.R. Bosch, R. Dave, L.A. Meyer (eds)], Cambridge University Press, Cambridge, United Kingdom and New York, NY, United States., XXX pp.
9. ↑ "The energy transition will be much cheaper than you think". The Economist. ISSN 0013-0613. https://www.economist.com/interactive/briefing/2024/11/14/the-energy-transition-will-be-much-cheaper-than-you-think. "The incremental bill to cut emissions is likely to be less than $1trn a year, which is to say less than one percent of global GDP."
10. ↑ United Nations Environment Programme (2023). Adaptation Gap Report 2023: Underfinanced.Underprepared. Inadequate investment and planning on climate adaptation leaves world exposed. Nairobi. doi:10.59117/20.500.11822/43796
11. ↑ 11.00 11.01 11.02 11.03 11.04 11.05 11.06 11.07 11.08 11.09 O'Neill, B., M. van Aalst, Z. Zaiton Ibrahim, L. Berrang Ford, S. Bhadwal, H. Buhaug, D. Diaz, K. Frieler, M. Garschagen, A. Magnan, G. Midgley, A. Mirzabaev, A. Thomas, and R.Warren, 2022: Chapter 16: Key Risks Across Sectors and Regions. In: Climate Change 2022: Impacts, Adaptation and Vulnerability. Contribution of Working Group II to the Sixth Assessment Report of the Intergovernmental Panel on Climate Change [H.-O. Pörtner, D.C. Roberts, M. Tignor, E.S. Poloczanska, K. Mintenbeck, A. Alegría, M. Craig, S. Langsdorf, S. Löschke, V. Möller, A. Okem, B. Rama (eds.)]. Cambridge University Press, Cambridge, UK and New York, NY, USA, pp. 2411–2538, doi:10.1017/9781009325844.025
12. ↑ Luomi, Mari (2020). ﻿Global Climate Change Governance: The search for effectiveness and universality﻿ (Report). International Institute for Sustainable Development (IISD).
13. ↑ 13.0 13.1 Brown, Eryn (30 September 2021). "Now is the time to prepare for the economic shocks of battling climate change". Knowable Magazine. doi:10.1146/knowable-093021-1. https://knowablemagazine.org/article/food-environment/2021/cost-of-climate-change. Retrieved 21 January 2022.
14. ↑ 14.0 14.1 van der Ploeg, Frederick; Rezai, Armon (6 October 2020). "Stranded Assets in the Transition to a Carbon-Free Economy". Annual Review of Resource Economics 12 (1): 281–298. doi:10.1146/annurev-resource-110519-040938. ISSN 1941-1340.
15. ↑ IPCC, 2022: Summary for Policymakers [H.-O. Pörtner, D.C. Roberts, E.S. Poloczanska, K. Mintenbeck, M. Tignor, A. Alegría, M. Craig, S. Langsdorf, S. Löschke, V. Möller, A. Okem (eds.)]. In: Climate Change 2022: Impacts, Adaptation and Vulnerability. Contribution of Working Group II to the Sixth Assessment Report of the Intergovernmental Panel on Climate Change [H.-O. Pörtner, D.C. Roberts, M. Tignor, E.S. Poloczanska, K. Mintenbeck, A. Alegría, M. Craig, S. Langsdorf, S. Löschke, V. Möller, A. Okem, B. Rama (eds.)]. Cambridge University Press, Cambridge, UK and New York, NY, USA, pp. 3–33, doi:10.1017/9781009325844.001
16. ↑ 16.0 16.1 "TS.5.4 Perspectives on climate change and sustainability. In (book chapter) Technical summary", Climate Change 2007: Impacts, Adaptation and Vulnerability, https://archive.ipcc.ch/publications_and_data/ar4/wg2/en/tssts-5-4.html , in IPCC AR4 WG2 2007
17. ↑ 17.0 17.1 "12.3 Implications of mitigation choices for sustainable development goals. In (book chapter) 12. Sustainable Development and mitigation", Climate Change 2007: Mitigation of Climate Change, Journal of Environmental Quality, 38, 2009, p. 837, doi:10.2134/jeq2008.0024br, Bibcode: 2009JEnvQ..38..837V, https://archive.ipcc.ch/publications_and_data/ar4/wg3/en/ch12s12-3.html , in IPCC AR4 WG3 2007
18. ↑ Shindell D; Faluvegi G; Seltzer K; Shindell C (2018). "Quantified, Localized Health Benefits of Accelerated Carbon Dioxide Emissions Reductions.". Nat Clim Change 8 (4): 291–295. doi:10.1038/s41558-018-0108-y. PMID 29623109. Bibcode: 2018NatCC...8..291S.
19. ↑ Watts N et al. (2019). "The 2019 report of The Lancet Countdown on health and climate change: ensuring that the health of a child born today is not defined by a changing climate.". Lancet 394 (10211): 1836–1878. doi:10.1016/S0140-6736(19)32596-6. PMID 31733928. Bibcode: 2019Lanc..394.1836W.
20. ↑ 20.0 20.1 20.2 Clarke L., K. Jiang, K. Akimoto, M. Babiker, G. Blanford, K. Fisher-Vanden, J.-C. Hourcade, V. Krey, E. Kriegler, A. Löschel, D. McCollum, S. Paltsev, S. Rose, P.R. Shukla, M. Tavoni, B.C.C. van der Zwaan, and D.P. van Vuuren, 2014: Assessing Transformation Pathways. In: Climate Change 2014: Mitigation of Climate Change. Contribution of Working Group III to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change [Edenhofer, O., R. Pichs-Madruga, Y. Sokona, E. Farahani, S. Kadner, K. Seyboth, A. Adler, I. Baum, S. Brunner, P. Eickemeier, B. Kriemann, J. Savolainen, S. Schlömer, C. von Stechow, T. Zwickel and J.C. Minx (eds.)]. Cambridge University Press, Cambridge, United Kingdom and New York, NY, USA.
21. ↑ 21.0 21.1 21.2 21.3 Dell, M., Jones, B. F., & Olken, B. A. (2014). What do we learn from the weather? The new climate-economy literature. Journal of Economic literature, 52(3), 740–798.
22. ↑ 22.0 22.1 IPCC, 2022: Annex II: Glossary [Möller, V., R. van Diemen, J.B.R. Matthews, C. Méndez, S. Semenov, J.S. Fuglestvedt, A. Reisinger (eds.)]. In: Climate Change 2022: Impacts, Adaptation and Vulnerability. Contribution of Working Group II to the Sixth Assessment Report of the Intergovernmental Panel on Climate Change [H.-O. Pörtner, D.C. Roberts, M. Tignor, E.S. Poloczanska, K. Mintenbeck, A. Alegría, M. Craig, S. Langsdorf, S. Löschke, V. Möller, A. Okem, B. Rama (eds.)]. Cambridge University Press, Cambridge, UK and New York, NY, USA, pp. 2897–2930, doi:10.1017/9781009325844.029
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25. ↑ 25.0 25.1 "7. Costing Methodologies.". Climate Change 2001: Mitigation. Contribution of Working Group III to the Third Assessment Report of the Intergovernmental Panel on Climate Change. Cambridge: Cambridge University Press. 2001. https://www.ipcc.ch/site/assets/uploads/2018/03/WGIII_TAR_full_report.pdf. Retrieved 10 January 2022.
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29. ↑ 29.0 29.1 "4.1.1 Areas of agreement and disagreement. In (book chapter) 4. Intertemporal Equity, Discounting, and Economic Efficiency", IPCC SAR WG3 1996, pp. 130–131
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31. ↑ "2.5.1.3 Discounting the future. In (book chapter) 2. Methods and Tools", IPCC TAR WG2 2001
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36. ↑ "2. Methods and Tools". Climate Change 2001: Impacts, Adaptation and Vulnerability. Contribution of Working Group II to the Third Assessment Report of the Intergovernmental Panel on Climate Change. Cambridge, UK, and New York, N.Y.: Cambridge University Press. 2001. pp. 105–144. https://www.ipcc.ch/site/assets/uploads/2018/03/wg2TARchap2.pdf. Retrieved 19 January 2022.
37. ↑ "10. Decision-making Frameworks". Climate Change 2001: Mitigation. Contribution of Working Group III to the Third Assessment Report of the Intergovernmental Panel on Climate Change. Cambridge: Cambridge University Press. 2001. https://www.ipcc.ch/site/assets/uploads/2018/03/WGIII_TAR_full_report.pdf. Retrieved 20 January 2022.
38. ↑ Roson, R. and M. Sartori, 2016: Estimation of climate change damage functions for 140 regions in the GTAP 9 data base. J. Glob. Econ. Anal., 1(2), doi:10.21642/JGEA.010202AF
39. ↑ 39.0 39.1 Watkiss, P. and Hunt, A. (2012). Cost-effectiveness analysis:: Decision Support Methods for Adaptation, MEDIATION Project, Briefing Note 2. Funded by the EC's 7FWP
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51. ↑ Grippa, Pierpaolo; Schmittmann, Jochen; Suntheim, Felix (2019). "Climate Change and Financial Risk Central banks and financial regulators are starting to factor in climate change". Finance & Development 56 (4). https://www.imf.org/external/pubs/ft/fandd/2019/12/climate-change-central-banks-and-financial-risk-grippa.htm. Retrieved 21 January 2022.
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55. ↑ Nordhaus, William (August 2018). "Projections and Uncertainties about Climate Change in an Era of Minimal Climate Policies" (in en). American Economic Journal: Economic Policy 10 (3): 333–360. doi:10.1257/pol.20170046. ISSN 1945-7731.
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57. ↑ Hassler, John; Krusell, Per; Olovsson, Conny (2019). The consequences of uncertainty: Climate sensitivity and economic sensitivity to the climate. Sveriges Riksbank Working Paper Series, No. 369. Sveriges Riksbank. http://hdl.handle.net/10419/215447. Retrieved 21 January 2022.
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183. ↑ Mintz-Woo, Kian; Leroux, Justin (November 2021). "What do climate change winners owe, and to whom?" (in en). Economics & Philosophy 37 (3): 462–483. doi:10.1017/S0266267120000449. ISSN 0266-2671.
184. ↑ Rosenbloom, Daniel; Markard, Jochen; Geels, Frank W.; Fuenfschilling, Lea (21 April 2020). "Why carbon pricing is not sufficient to mitigate climate change—and how "sustainability transition policy" can help" (in en). Proceedings of the National Academy of Sciences 117 (16): 8664–8668. doi:10.1073/pnas.2004093117. ISSN 0027-8424. PMID 32269079. Bibcode: 2020PNAS..117.8664R.
185. ↑ Bartolomeo, Giovanni Di; Fard, Behnaz Minooei; Semmler, Willi (June 2023). "Greenhouse gases mitigation: global externalities and short-termism" (in en). Environment and Development Economics 28 (3): 230–241. doi:10.1017/S1355770X22000249. ISSN 1355-770X. Bibcode: 2023EDevE..28..230D. https://web.uniroma1.it/dip_ecodir/sites/default/files/wpapers/wp196.pdf.
186. ↑ Papaoikonomou, Eleni; Ginieis, Matías; Alarcón, Amado Alarcón (15 November 2023). "The Problematics of Being an Ethical Consumer in the Marketplace: Unpacking the Concept of Ethical Consumer Literacy" (in en). Journal of Public Policy & Marketing 43 (2): 133–150. doi:10.1177/07439156231202746. ISSN 0743-9156. "Instead of placing the responsibility on individual consumers, governments should increase ethical consumer literacy.".
187. ↑ "AR6 Synthesis Report: Climate Change 2023 — IPCC". https://www.ipcc.ch/report/sixth-assessment-report-cycle/.
188. ↑ Hoang, Nguyen Tien; Kanemoto, Keiichiro (June 2021). "Mapping the deforestation footprint of nations reveals growing threat to tropical forests" (in en). Nature Ecology & Evolution 5 (6): 845–853. doi:10.1038/s41559-021-01417-z. ISSN 2397-334X. PMID 33782576. Bibcode: 2021NatEE...5..845H.
189. ↑ "Supermarket food could soon carry eco-labels, says study". 9 August 2022. https://www.bbc.com/news/science-environment-62460551.
190. ↑ Clark, Michael; Springmann, Marco; Rayner, Mike; Scarborough, Peter; Hill, Jason; Tilman, David; Macdiarmid, Jennie I.; Fanzo, Jessica et al. (16 August 2022). "Estimating the environmental impacts of 57,000 food products" (in en). Proceedings of the National Academy of Sciences 119 (33). doi:10.1073/pnas.2120584119. ISSN 0027-8424. PMID 35939701. Bibcode: 2022PNAS..11920584C.
191. ↑ Kolcava, Dennis; Smith, E. Keith; Bernauer, Thomas (January 2023). "Cross-national public acceptance of sustainable global supply chain policy instruments" (in en). Nature Sustainability 6 (1): 69–80. doi:10.1038/s41893-022-00984-8. ISSN 2398-9629.
192. ↑ Semieniuk, Gregor; Holden, Philip B.; Mercure, Jean-Francois; Salas, Pablo; Pollitt, Hector; Jobson, Katharine; Vercoulen, Pim; Chewpreecha, Unnada et al. (June 2022). "Stranded fossil-fuel assets translate to major losses for investors in advanced economies" (in en). Nature Climate Change 12 (6): 532–538. doi:10.1038/s41558-022-01356-y. ISSN 1758-6798. Bibcode: 2022NatCC..12..532S.
* News article: "People in US and UK face huge financial hit if fossil fuels lose value, study shows" (in en). The Guardian. 26 May 2022. https://www.theguardian.com/environment/2022/may/26/people-in-us-and-uk-face-huge-financial-hit-if-fossil-fuels-lose-value-study-shows.

### Sources

* IPCC AR5 WG2 A (2014), Field, C.B., ed., Climate Change 2014: Impacts, Adaptation, and Vulnerability. Part A: Global and Sectoral Aspects. Contribution of Working Group II (WG2) to the Fifth Assessment Report (AR5) of the Intergovernmental Panel on Climate Change (IPCC), Cambridge University Press, http://archive.ipcc.ch/report/ar5/wg2/ . Archived
* IPCC (2018). Global Warming of 1.5 °C. An IPCC Special Report on the impacts of global warming of 1.5 °C above pre-industrial levels and related global greenhouse gas emission pathways, in the context of strengthening the global response to the threat of climate change, sustainable development, and efforts to eradicate poverty. Intergovernmental Panel on Climate Change. https://www.ipcc.ch/site/assets/uploads/sites/2/2019/07/SR15_Full_Report_Low_Res.pdf.
* IPCC TAR WG2 (2001), McCarthy, J. J.; Canziani, O. F.; Leary, N. A. et al., eds., Climate Change 2001: Impacts, Adaptation and Vulnerability, Contribution of Working Group II to the Third Assessment Report of the Intergovernmental Panel on Climate Change, Cambridge University Press, ISBN 978-0-521-80768-5, https://archive.org/details/climatechange2000000unse_j1j8, retrieved 2 August 2019 (pb: 0-521-01500-6).
* IPCC AR4 WG2 (2007), Parry, M.L.; Canziani, O.F.; Palutikof, J.P. et al., eds., Climate Change 2007: Impacts, Adaptation and Vulnerability, Contribution of Working Group II to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change, Cambridge University Press, ISBN 978-0-521-88010-7, http://www.ipcc.ch/publications_and_data/ar4/wg2/en/contents.html, retrieved 22 January 2012 (pb: 978-0-521-70597-4).

* House of Lords (21 June 2005), The Economics of Climate Change, the Second Report of the 2005–2006 session (HL 12-I and HL 12-II), produced by the UK Parliament House of Lords (HOL) Economics Affairs Select Committee, London, UK: The Stationery Office, https://publications.parliament.uk/pa/ld200506/ldselect/ldeconaf/12/1202.htm . High-resolution PDF versions: HL 12-I (report), HL 12-II (evidence).
* IPCC SAR WG3 (1996), Climate Change 1995: Economic and Social Dimensions of Climate Change, Contribution of Working Group III to the Second Assessment Report of the Intergovernmental Panel on Climate Change, Cambridge, UK: Cambridge University Press, ISBN 978-0-521-56051-1, https://www.ipcc.ch/site/assets/uploads/2018/03/ipcc_sar_wg_III_full_report.pdf (pb: 0-521-56854-4)

* IPCC TAR WG3 (2001), Metz, B.; Davidson, O.; Swart, R. et al., eds., Climate Change 2001: Mitigation, Contribution of Working Group III to the Third Assessment Report of the Intergovernmental Panel on Climate Change, Cambridge University Press, ISBN 978-0-521-80769-2, https://www.ipcc.ch/site/assets/uploads/2018/03/WGIII_TAR_full_report.pdf, retrieved 17 January 2022 (pb: 0-521-01502-2).

* IPCC AR4 WG3 (2007), Climate Change 2007: Mitigation of Climate Change, Contribution of Working Group III to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change, Cambridge University Press, ISBN 978-0-521-88011-4, https://www.ipcc.ch/site/assets/uploads/2018/03/ar4_wg3_full_report-1.pdf (pb: 978-0-521-70598-1).

## External links

* Centre for Climate Change Economics and Policy at University of Leeds and London School of Economics.
* "The economics of climate change". 2020 lecture by William Nordhaus, Sterling Professor of Economics at Yale University
* "From Climate Crisis to Real Prosperity". 2020 Reith lecture by Mark Carney, COP26 finance advisor

* v
* t
* e

Climate change

Overview

* Causes of climate change
* Effects of climate change
* Climate change mitigation
* Climate change adaptation
* By country and region

Causes

| Overview|

* Climate system
* Greenhouse effect (Carbon dioxide in the atmosphere of Earth)
* Scientific consensus on climate change

|

Sources|

* Deforestation
* Fossil fuel
* Greenhouse gases
* Greenhouse gas emissions
* Carbon accounting
* Carbon footprint
* Carbon leakage
* from agriculture
* from wetlands
* World energy supply and consumption

History

* History of climate change policy and politics
* History of climate change science
* Svante Arrhenius
* James Hansen
* Charles David Keeling
* United Nations Climate Change conferences
* Years in climate change
* 2019
* 2020
* 2021
* 2022
* 2023
* 2024
* 2025
* 2026

Effects and issues

| Physical|

* Abrupt climate change
* Anoxic event
* Arctic methane emissions
* Arctic sea ice decline
* Atlantic meridional overturning circulation
* Drought
* Extreme weather
* Flood
* Coastal flooding
* Heat wave
* Marine
* Urban heat island
* Oceans
* acidification
* deoxygenation
* heat content
* sea surface temperature
* stratification
* temperature
* Ozone depletion
* Permafrost thaw
* Retreat of glaciers since 1850
* Sea level rise
* Season creep
* Climate sensitivity
* Tipping points in the climate system
* Tropical cyclones
* Water cycle
* Wildfires

|

Flora and fauna|

* Biomes
* Mass mortality event
* Birds
* Extinction risk
* Forest dieback
* Invasive species
* Marine life
* Plant biodiversity

Social and economic|

* Agriculture
* Livestock
* Multi-breadbasket failure
* In the United States
* Children
* Cities
* Civilizational collapse
* Crime
* Depopulation of settlements
* Destruction of cultural heritage
* Disability
* Economic impacts
* U.S. insurance industry
* Fisheries
* Gender
* Health
* Infectious diseases
* Mental health
* In the United Kingdom
* In the Philippines
* Human rights
* Indigenous peoples
* Migration
* Poverty
* Psychological impacts
* Security and conflict
* Urban flooding
* Water scarcity
* Water security

By country and region|

* Africa
* Americas
* Antarctica
* Arctic
* Asia
* Australia
* Caribbean
* Europe
* Middle East and North Africa
* Small island countries
* by individual country

Mitigation

| Economics and finance|

* Carbon budget
* Carbon emission trading
* Carbon offsets and credits
* Gold Standard (carbon offset standard)
* Carbon price
* Carbon tax
* Climate debt
* Climate finance
* Climate risk insurance
* Co-benefits of climate change mitigation
* Economics of climate change mitigation
* Fossil fuel divestment
* Green Climate Fund
* Low-carbon economy
* Net zero emissions

|

Energy|

* Carbon capture and storage
* Energy transition
* Fossil fuel phase-out
* Nuclear power
* Renewable energy
* Sustainable energy

Preserving and enhancing
carbon sinks|

* Blue carbon
* Carbon dioxide removal
* Carbon sequestration
* Direct air capture
* Carbon farming
* Climate-smart agriculture
* Forest management
* afforestation
* forestry for carbon sequestration
* REDD+
* reforestation
* Land use, land-use change, and forestry (LULUCF and AFOLU)
* Nature-based solutions

Other|

* Earth Strike
* Fridays for Future
* Geoengineering
* Individual action on climate change
* Positive tipping points
* Sustainable architecture
* Sustainable transport

Society and adaptation

| Society|

* Business action
* Climate action
* Climate emergency declaration
* Climate movement
* School Strike for Climate
* Denial
* Ecological grief
* Governance
* Justice
* Litigation
* Politics
* Public opinion
* Women

|

Adaptation|

* Adaptation strategies on the German coast
* Adaptive capacity
* Disaster risk reduction
* Ecosystem-based adaptation
* Flood control
* Loss and damage
* Managed retreat
* Nature-based solutions
* Resilience
* Risk
* Vulnerability
* The Adaptation Fund
* National Adaptation Programme of Action

Communication|

* Climate Change Performance Index
* Climate crisis (term)
* Climate spiral
* Education
* Media coverage
* Popular culture depictions
* art
* fiction
* video games
* Warming stripes

International agreements|

* Glasgow Climate Pact
* Integrity Council for the Voluntary Carbon Market
* Taskforce on Scaling Voluntary Carbon Markets
* Kyoto Protocol
* Paris Agreement
* Cooperative mechanisms under Article 6 of the Paris Agreement
* Nationally determined contributions
* Sustainable Development Goal 13
* United Nations Framework Convention on Climate Change

Background and theory

| Measurements|

* Global surface temperature
* Instrumental temperature record
* Proxy
* Satellite temperature measurement

|

Theory|

* Albedo
* Carbon cycle
* atmospheric
* biologic
* oceanic
* permafrost
* Carbon sink
* Climate sensitivity
* Climate variability and change
* Cloud feedback
* Cloud forcing
* Fixed anvil temperature hypothesis
* Cryosphere
* Earth's energy budget
* Extreme event attribution
* Feedbacks
* Global warming potential
* Illustrative model of greenhouse effect on climate change
* Orbital forcing
* Radiative forcing

Research and modelling|

* Climate change scenario
* Climate model
* Coupled Model Intercomparison Project
* Intergovernmental Panel on Climate Change (IPCC)
* IPCC Sixth Assessment Report
* Paleoclimatology
* Representative Concentration Pathway
* Shared Socioeconomic Pathways

* '
* Category
* Glossary
* Index

* v
* t
* e

Economics

* Economic theory
* Political economy
* Applied economics

Methodology|

* Economic model
* Economic systems
* Microfoundations
* Mathematical economics
* Econometrics
* Computational economics
* Experimental economics
* Publications

Microeconomics|

* Aggregation problem
* Budget set
* Consumer choice
* Convexity
* Cost
* Average
* Marginal
* Opportunity
* Social
* Sunk
* Transaction
* Cost–benefit analysis
* Deadweight loss
* Distribution
* Economies of scale
* Economies of scope
* Elasticity
* Equilibrium
* General
* Externality
* Firm
* Goods and services
* Goods
* Service
* Indifference curve
* Interest
* Intertemporal choice
* Market
* Market failure
* Market structure
* Competition
* Monopolistic
* Perfect
* Monopoly
* Bilateral
* Monopsony
* Oligopoly
* Oligopsony
* Non-convexity
* Pareto efficiency
* Preference
* Price
* Production set
* Profit
* Public good
* Rate of profit
* Rationing
* Rent
* Returns to scale
* Risk aversion
* Scarcity
* Shortage
* Surplus
* Social choice
* Supply and demand
* Trade
* Uncertainty
* Utility
* Expected
* Marginal
* Value
* Wage
* Publications

Macroeconomics|

* Aggregate demand
* Balance of payments
* Business cycle
* Capacity utilization
* Capital flight
* Central bank
* Consumer confidence
* Currency
* Deflation
* Demand shock
* Depression
* Great
* Disinflation
* DSGE
* Effective demand
* Expectations
* Adaptive
* Rational
* Fiscal policy
* General Theory of Keynes
* Growth
* Indicators
* Inflation
* Hyperinflation
* Interest rate
* Investment
* IS–LM model
* Measures of national income and output
* Models
* Money
* Creation
* Demand
* Supply
* Monetary policy
* NAIRU
* National accounts
* Price level
* PPP
* Recession
* Saving
* Shrinkflation
* Stagflation
* Supply shock
* Unemployment
* Publications

Mathematical
economics|

* Contract theory
* Decision theory
* Econometrics
* Game theory
* Input–output model
* Mathematical finance
* Mechanism design
* Operations research

Applied fields|

* Agricultural
* Business
* Demographic
* Development
* Economic geography
* Economic history
* Education
* Industrial Engineering
* Civil Engineering
* Environmental
* Financial
* Health
* Industrial organization
* International
* Knowledge
* Labour
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* Monetary
* Natural resource
* Economic planning
* Economic policy
* Public economics
* Public choice
* Regional
* Service
* Socioeconomics
* Economic sociology
* Economic statistics
* Transportation
* Urban
* Welfare

Schools (history)
of economic thought

* American (National)
* Ancient thought
* Anarchist
* Mutualism
* Austrian
* Behavioral
* Buddhist
* Chartalism
* Modern Monetary Theory
* Chicago
* Classical
* Disequilibrium
* Ecological
* Evolutionary
* Feminist
* Georgism
* Heterodox
* Historical
* Institutional
* Keynesian
* Neo- (neoclassical–Keynesian synthesis)
* New
* Post-
* Circuitism
* Mainstream
* Malthusianism
* Marginalism
* Marxian
* Neo
* Mercantilism
* Neoclassical
* Lausanne
* New classical
* Real business-cycle theory
* New institutional
* Physiocracy
* Socialist
* Stockholm
* Supply-side
* Thermoeconomics

Notable economists
and thinkers
within economics

* François Quesnay
* Adam Smith
* David Ricardo
* Thomas Robert Malthus
* Johann Heinrich von Thünen
* Friedrich List
* Hermann Heinrich Gossen
* Jules Dupuit
* Antoine Augustin Cournot
* John Stuart Mill
* Karl Marx
* William Stanley Jevons
* Henry George
* Léon Walras
* Alfred Marshall
* Georg Friedrich Knapp
* Francis Ysidro Edgeworth
* Vilfredo Pareto
* Friedrich von Wieser
* John Bates Clark
* Thorstein Veblen
* John R. Commons
* Irving Fisher
* Wesley Clair Mitchell
* John Maynard Keynes
* Joseph Schumpeter
* Arthur Cecil Pigou
* Frank Knight
* John von Neumann
* Alvin Hansen
* Jacob Viner
* Edward Chamberlin
* Ragnar Frisch
* Harold Hotelling
* Michał Kalecki
* Oskar R. Lange
* Jacob Marschak
* Gunnar Myrdal
* Abba P. Lerner
* Roy Harrod
* Piero Sraffa
* Simon Kuznets
* Joan Robinson
* E. F. Schumacher
* Friedrich Hayek
* John Hicks
* Tjalling Koopmans
* Nicholas Georgescu-Roegen
* Wassily Leontief
* John Kenneth Galbraith
* Hyman Minsky
* Herbert A. Simon
* Milton Friedman
* Paul Samuelson
* Kenneth Arrow
* William Baumol
* Gary Becker
* Elinor Ostrom
* Robert Solow
* Amartya Sen
* Robert Lucas Jr.
* Joseph Stiglitz
* Richard Thaler
* Paul Krugman
* Thomas Piketty
* more

International
organizations|

* Asia-Pacific Economic Cooperation
* Economic Cooperation Organization
* European Free Trade Association
* International Monetary Fund
* Organisation for Economic Co-operation and Development
* World Bank
* World Trade Organization

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Business and economics portal

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