Climate Change Feedback on Economic Growth: Explorations with a Dynamic General Equilibrium Model

Ramiro Parrado, Fabio Eboli, Roberto Roson
2009 Social Science Research Network  
Human-generated greenhouse gases depend on the level 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. Moreover, impacts affect expected capital returns, international capital flows, savings and
more » ... avings and investments. We use a dynamic, multi-regional CGE model of the world economy to explore all these issues. We compare economic growth paths for the various regional economies, to answer the following questions: 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?
doi:10.2139/ssrn.1443885 fatcat:neicpkuzy5aevdtshqxtjlufcu