Some Economic Implications of Global Climate Change

Each time I post something on the environment, a number of readers admonish me to get back to economics. Well, it’s been obvious to many observers that the two are interlinked. Consider one graph from NOAA, and two others from Economic Benefits of Increasing Electric Grid Resilience to Weather Outages, a joint CEA and DOE report, released on Tuesday.

First, documentation of rising global temperatures, particularly on land.

Figure 1: Source: NOAA.Second, the weather related impacts on the US power grid.

Figure from Economic Benefits of Increasing Electric Grid Resilience to Weather Outages (August 2013).

Figure from Economic Benefits of Increasing Electric Grid Resilience to Weather Outages (August 2013).Here is one argument against human activity as a source of global climate change. A National Research Council/National Academy of Sciences perspective is discussed in this post.

This piece is cross-posted from Econbrowser with permission.

8 Responses to "Some Economic Implications of Global Climate Change"

  1. mememine69   August 17, 2013 at 9:29 am

    Climate blame was an exciting research opportunity for lab coat consultants, fuel for fear mongers, fodder for pandering politicians and a lazy copy and paste news editor's dream come true and not one single "journalist" here has ever mentioned that the experts never did agree it would happen, only could happen and it's been 28 years!
    The neocons have their right to life crap and libs condemn their own kids to their exaggerated climate blame crisis.

  2. mememine69   August 17, 2013 at 9:29 am

    After 28 years we need to end this costly debate!
    A consensus of “maybe” instead of “will be” is unsustainable and science itself is at fault for feeding the deniers all the doubt they need.
    It's not oil that is feeding the denial machine, it's the scientist's own wishy washy “maybe” consensus that their comet hit of an emergency only "could" happen as the IPCC has never agreed in 28 years that it will "eventually" happen like they say comet hits "will". Not one IPCC warning isn’t drowning in “could bes” and “maybes” and…..
    If science agreed it WILL happen instead of "might" happen the debate would end and the planet could be saved. We demand that the lab coats stop feeding the deniers doubt and give us a clear warning for a real crisis that WILL happen not just "might" happen otherwise climate change belief and CO2 mitigation is impossible and we are all doomed. The ultimate crisis needs the ultimate certainty, this isn’t grade 8 science class, this is about life and death!
    What has to happen now? How close to unstoppable warming will the experts take us before they say their own deadly crisis will happen instead of only agreeing it could happen.

    • Sonny   August 20, 2013 at 8:58 am

      The political and economic cost is too high, to make that decision at this time. Just like the debate over the National Debt and deficit spending. Political interests demand the status quo, so we will continue on the same path until the end…………….. Maybe God will take us out of here, before it gets too bad.

  3. gzuckier   August 17, 2013 at 11:41 pm

    Both of the above comments serve as explanations as to why climate change has penetrated the public consciousness so little.
    Scientists are extensively taken to task for overstatement in their publications and generally have to be quite conservative in their predictions. You'd be lucky to find a scientific publication which would go out on a limb and assure you that the sun will rise tomorrow. On this particular topic is layered the constant criticism of being fear mongers, constantly being called "chicken littles", accusations of deliberate felony fraud in order to manipulate public fear for purposes of grant acquisition, etc.etc.
    At this point, the evidence for AGW is one of the most well established bodies of data in the world, thanks to the constant denial. The room for uncertainty is only in the degree of change and the concomitant degree of shock to our economy and our entire complex and vulnerable civilization; and the estimates are converging on the approximate middle of the range as has been continually given. Even the scientists held up by denialists, Lindzen et al, are now in the camp of arguing for the low end of the range, which is continually moving upwards.
    Despite the claims of inadequacy of the AGW models, to any objective eye the predictions have beenremarkably good, considering that we only now have enough data to average to confirm the earliest and crudest midels, and they do a good job on not only the single measure of global average temperature but of many details of the process. In contrast, it is important to note that there is no model of climate without AGW of any degree of accuracy at all. In any other field that would be considered absolute invalidation of the denialist positions In fact, the jumble of sound bites which makes up the denialist position is so internally contradictory as to invalidate itself; in no other field would "the warming has now ended", "the warming is solar in origin", and "the warming is all a hoax" be considered a coherent set of counterarguments. It fact, in any other field the onus would be on skeptics to explain why a chain of well established causes and effects that makes up the mechanism would fail to act as predicted; does CO2 not absorb IR? Are we not burning fossil carbon? Does burning carbon not produce CO2?
    The most obvious clue that separates denial from skrpticism is the absence of any hint as to what evidence would consist "proof" to them which is currently lacking. Instead there dismissive references to "the evidence just isn't enough" with no clue as to what or when might be enough. Those with less sophistication even will proudly assert that there is no amount of evidence that will convince them. However science does not judge factuality on the basis of nobody being able to say "I'm still not convinced".
    So the results are that we see AGW theory questioned as in the comments here; not by questioning the theory itself, but by attacking the scientists behind it, who are variously accused of fraud and of failure to provide convincing enough proof.

  4. @DeadweightLoss   August 19, 2013 at 5:32 am

    I am not sure that this hits on the real costs that we are likely to see from climate change. Sure, there will be some inconveniences that will hit some of the more advanced countries in the form of impacts on infrastructure and large storms, but these are unlikely to be life-changing impacts.

    In developing countries such as Bangladesh and Ethiopia, climate change poses the risk of real humanitarian catastrophe and mass emigration. Even as an economist, I understand these are the costs that we should really be concerned about. It is true that they will not hit developed countries like the US directly, but I reject the view that Americans will not or should not care about the costs imposed on others for our benefit. That is simply not the American way of doing things. Here is a plea to change the narrative around climate change in America:

    Thanks for the article. It is important to keep this issue in the spotlight.

    • brassey   August 20, 2013 at 4:43 am

      30 years ago we were going into a new ice age; now of course it is the opposite; but think about it for a minute if you will; nothing lasts forever, so relax and enjoy your short stay.

  5. Central Harlem Anon   August 20, 2013 at 10:08 am

    P&C insurers and reinsurers deal with this issue on a daily basis. Not a one of them doubts that global warming is real, and many of them have released multiple publications on the topic, changed contract terms to compensate, and are otherwise trying to prepare themselves for the new normal.

  6. EWulf   August 20, 2013 at 5:20 pm

    I guess the problem is not that much the climate change itself , but what is the credible information available to make decisions.
    In the graphs above , appears land temperature is rising.However, there is no detailed specificaction nor clarification concerning the difference between rural and urban areas Migration, which took place in the latest years meant to displace people from rural towns to urban cities..Only China is planning to move 200 million people to urban areas.
    The counterpart of this situation ,should be a decrease in temperatures in less populated rural areas. Unless it is said that those higher temperatures ,are net of migration flows, which means are on average between rural and urban land,how can be possible to address a definite conclusion about rising land temperatures?.
    The comments above do not means to rule out the relevance of better management of natural resources, such as water.Neither it denies the relevance of searching new technologies to capture dioxide of carbon from the atmosphere, which is already taking place in some areas of New York,( although still at small scale).But misleading information does not leads to better decision.