The Damage Costs of Climate Change: Towards a Dynamic Representation

Economic assessments of climate change impacts are commonly presented as the effect of aclimate change associated with a doubling of the atmospheric concentration of carbon dioxide on the current economy. This paper is an attempt to express impact as a function of both climate change and socio-economic change. With regard to climate change, issues discussed are level versus rate of change, speed of adaptation, speed of restoration and value adjustment, and symmetry. With regard to socio-economic change, agriculture, migration and the valuation of intangible losses are addressed. Uncertainty and higher order impacts are treated briefly. It is qualitatively argued and quantitatively illustrated that these issues matter a great deal for the damage profile over the next century. Adamage model, based on my best guesses, is presented in the Appendix.