Announcements
Announcements
Economic models of climate change often take the problem seriously, but paradoxically conclude that the optimal policy is to do almost nothing about it. We explore this paradox as seen in the widely used DICE model.
Three aspects of that model, involving the discount rate, the assumed benefits of moderate warming, and the treatment of the latest climate science, are sufficient to explain the timidity of the model’s optimal policy recommendation. With modifications to those three points, DICE shows that the optimal policy is a much higher and rapidly rising marginal carbon price; and that higher carbon price has a greater effect on physical measures of climate impacts.
Our modifications exhibit nonlinear interactions; at least at low discount rates, there is synergy
between individual changes to the model. At low discount rates, the inherent uncertainty about future damages looms larger in the analysis, rendering long-run economic modelling less useful. Our analysis highlights the sensitivity of the model to three debatable assumptions; it does not, and could not, lead to a more reliably ‘optimal’ cost of carbon.
Cost-effectiveness analysis, focusing on the generally shorter-term cost side of the problem, reduces the economic paradoxes of the long run, and may make a greater contribution than economic optimization modelling.
Event on 15 May in York / Sarah Laptain hosts four early career researchers delving into the themes of food security, climate change, and infant nutrition in this informal event.
Event on 13 May in York / Smriti Safaya shares the results of York's participation in the 2024 City Nature Challenge during this 'Pint of Science' event.
Event on 04 June – 06 April in Turku / SEI York will discuss the collaborative teaching of sustainability and policy, using its interdisciplinary module at the University of York as a case study.
Design and development by Soapbox.
