ClimateClimate change will reshape global economy: Study
Unmitigated climate change is likely to reduce the income of an average person on Earth by roughly 23 percent in 2100, according to estimates contained in a new study. The findings indicate climate change will widen global inequality, perhaps dramatically, because warming is good for cold countries, which tend to be richer, and more harmful for hot countries, which tend to be poorer. In the researchers’ benchmark estimate, climate change will reduce average income in the poorest 40 percent of countries by 75 percent in 2100, while the richest 20 percent may experience slight gains.
Unmitigated climate change is likely to reduce the income of an average person on Earth by roughly 23 percent in 2100, according to estimates contained in research published in the journal Nature.
The findings indicate climate change will widen global inequality, perhaps dramatically, because warming is good for cold countries, which tend to be richer, and more harmful for hot countries, which tend to be poorer. In the researchers’ benchmark estimate, climate change will reduce average income in the poorest 40 percent of countries by 75 percent in 2100, while the richest 20 percent may experience slight gains.
TheNature paper focuses on effects of climate change via temperature, and does not include impacts via other consequences of climate change such as hurricanes or sea level rise. Detailed results and figures for each country are available for download online.
UC Berkeley’s Solomon Hsiang, Chancellor’s Associate Professor of Public Policy, was a co-leader of the study with Marshall Burke, a 2014 Ph.D. graduate from Berkeley and an assistant professor in earth system science at Stanford University. Berkeley’s Edward Miguel, Oxfam Professor of Environmental and Resource Economics, co-authored the results.
UC Berkeley reports that the trio’s work comes on the heels of their 2013 analysisthat linked increased human conflict, from murder to civil wars, to rising temperatures. It also shortly precedes worldwide climate negotiationsstarting 30 November in Paris, where policymakers will try to balance what they understand about the costs and benefits of agreements that might stem climate change.
Brave new world
“These results provide the first evidence that economic activity in all regions is coupled to the global climate,” the analysis reports. The team applied the results to standard scenarios of the twenty-first century to understand how the global economy might be affected by climate change.
They find climate change is likely to have global costs generally 2.5-100 times larger than predicted by current leading models. The team’s best estimate is that climate change will reduce global economic production by 23 percent in 2100.
“Historically, people have considered a 20 percent decline in global Gross Domestic Product to be a black swan: a low-probability catastrophe,” Hsiang warned. “We’re finding it’s more like the middle-of-the-road forecast.”
