Climate Change and Economic Growth
Author
Term
4. term
Education
Publication year
2023
Submitted on
2023-06-01
Pages
64
Abstract
Since one of today’s major political issues is how we reduce carbon emissions and their impact on both the climate and the economy, then this paper will examine ’how will the global economy be affected by climate change’. To analyze the problem, a simple climate-Solow model is used, which is the simplest Integrated Assessment Model (IAM). The paper will look at some of the main criticism of the DICE model such as the value of damages and determining the discount rate. The analysis shows why critics would like to value damages more, and the importance of a discount rate on the decision of what climate policy initiatives are more profitable. In comparison to the DICE model, the simple climate-Solow model gives an okay prediction and understanding of how the global economy will be affected by climate change, and what impact climate policy initiatives have.
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