Lecture: “Economic impacts of tipping points in the climate system”, by Thomas Stoerk

Lecture: “Economic impacts of tipping points in the climate system”

By Thomas Stoerk, London School of Economics

Organised by Research group Environmental & Climate Economics

Date: Wednesday, November 25 2020
Time: 11h-12.30h
Venue: online https://us02web.zoom.us/j/82096469748?pwd=VU5JbjNpNm5lcExHZ1d4SFBmMnBmQT09
ID de reunión: 820 9646 9748 - Código de acceso: 296811
 

Abstract

(co-authors Simon Dietz, James Rising and Gernot Wagner)

Tipping points in the climate system are one of the principal reasons for concern about climate change. Yet most economic studies either ignore them or represent them in highly stylised ways. Studies are beginning to appear, which model individual climate tipping points with geophysical realism and incorporate them into economic models. However, this literature is fragmented and estimates of the combined effects of tipping points are unavailable. We therefore synthesise this emerging literature to estimate the overall economic impacts of climate tipping points. To do this, we build a meta-analytical integrated assessment model, which nests multiple tipping point modules, each of which replicates a study in the literature. We analyse eight climate tipping points, including thawing permafrost, ice sheet disintegration, and changes in atmospheric circulation. The model includes national-level climate damages from rising temperatures and sea levels, calibrated using detailed empirical/simulation modelling. Collectively, climate tipping points increase the social cost of carbon (SCC) by around 1/4 in expectations. The distribution is positively skewed, and we estimate about a 10% chance they could more than double the SCC, which is mostly associated with assuming climate damages affect the growth rate rather than the level of economic activity. Accordingly, climate tipping points increase global economic risk. They increase economic losses almost everywhere and there is no material effect on inequality. The tipping points with the largest effects are thawing permafrost and dissociation of ocean methane hydrates, although the latter remains especially poorly understood. We identify future research needs, as several tipping points are yet to be covered by climate-economy models and point to areas of improvement for the modelling of others.

Bio
Thomas Stoerk is a Visiting Fellow at the Grantham Research Institute on Climate Change and the Environment at the LSE (London School of Economics). He is an environmental economist with research interests in air pollution control, the economics of climate change, climate policy, and empirical policy evaluation. Thomas earned his PhD in economics at Universitat Pompeu Fabra in 2017. He has subsequently been a postdoc with the Office of the Chief Economist at the Environmental Defense Fund in New York as well as a Policy Officer at the Directorate-General for Climate Action of the European Commission.