Economic Effects Of Climate Change Are Smaller Than Earlier Estimates

The Businomics Blog has a post by Bill Conerly about "Economic Effects of Climate Change."

He summarizes an article by Professor Richard S. J. Tol in the Journal of Economic Perspectives.

A few key points from his blog post.

• Recent estimates of the economic impact of climate change have been smaller than earlier estimates, probably because they have been better at estimating adaptation.
  
  
• Estimates of the economic impact of climate change range from zero percent to -4.8 percent of world gross domestic product. This cumulative impact is roughly the magnitude of annual economic growth, so it's as if a year of growth is skipped and never made up.
  
  
• Regional variation of economic impact is very large; total impact on the world of -0.1 percent of GDP; South America loses 14.6 percent; Western Europe gains 2.5 percent.
  
  
• The social cost of carbon may be around $50 per ton under reasonable assumptions. The European Union's carbon permits are traded at $78/ton, meaning that they are forcing too much restriction of carbon.