Richard Toll’s paper for the 2009 Copenhagen Climate Consensus that I mention in my previous post is well worth revisiting. It contains an excellent review of economic research on the potential aggregate costs of the warming projected by the U.N.
Toll—who, as a UNIPCC lead author, is hardly a climate skeptic—estimates that global consumption and output would be crippled by a carbon abatement scheme aimed at achieving the 450ppm atmospheric goal that Ross Garnaut now endorses. Global GDP would be down 12.5% on expected values in 2001. The cumulative slug to global output over the remainder of this century would be much larger.
To put that extreme plan in perspective you need to consider the extreme alternative: the cost of doing nothing about warming or CO2. It turns out that nine independent studies by experts in climate cost projections put the cost of doing nothing at less than one-fifth of cost of the 450ppm target.
Projections for the aggregate losses in output due even to the alarming global warming projections of the U.N. are similar in most of the nine independent models and surprisingly modest: a global GDP cut of 0.9% in 2001 as a result of 2.5° warming, and as high as a GDP cut of 2.7% for a 3° temperature rise (but these latter estimates are from the mid-1990s). The most common (i.e. modal) estimate of the marginal social cost of carbon-dioxide-equivalents—the “pollution” (sic) cost of an extra tonne of CO2 emissions—in the nine models is only $13 per tonne (the mean estimate is $105 per tonne due to one or two extreme guesses).