ESRI Working Paper

The Time Evolution of the Social Cost of Carbon: An Application of FUND

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September 5, 2011
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We estimate the growth rate of the social cost of carbon. This is an indication of the optimal rate of acceleration of greenhouse gas emission reduction policy over time. We find that the social cost of carbon increases by 1.3% to 3.9% per year, with a central estimate of 2.2%. Previous studies found an average rate of 2.3% and a range of 0.9-4.1%. The rate of increase of the social carbon depends on a range of factors, including the pure rate of time preference, the rate of risk aversion, equity weighting, the socio-economic and emission scenarios, the climate sensitivity, dynamic vulnerability, and the curvature of the impact functions.

Author(s)
David Anthoff
Steven Rose
Richard Tol
Stephanie Waldhoff

Publication Details

Publisher

ESRI

Place of Publication

Dublin

Date of Publication

September 5, 2011

ESRI Series

ESRI Working Paper 405