The economic impacts of climate change

Human-generated greenhouse gases vary with levels of economic activity. Therefore, most climate change studies are based on models and scenarios of economic growth. Economic growth itself, however, is likely to be affected by climate change impacts. These impacts affect the economy in multiple and complex ways: changes in productivity, resource endowments, production and consumption patterns.

This seminar will discuss some recent results obtained by using computer simulation models, based on general equilibrium theory.

The key questions are:

• Will climate change impacts significantly affect growth and wealth distribution in the world?
• Should forecasts of human induced greenhouse gases emissions be revised, once climate change impacts are taken into account?

Simulation results indicate that, even though economic growth and emission paths do not change significantly at the global level, relevant differences exist at the regional and sectoral level. In particular, developing countries appear to suffer the most from climate change impacts.