The science is ripe to update estimates of CO2 emissions costs. Calls to scrap the calculation are misguided.
Mere mention of the term ‘social cost of carbon’ (SCC) invites both superlatives as to its importance as the ‘holy grail’ of climate economics and strong counteractions, including calls to have it scrapped altogether. In some sense, the SCC is simply an attempt to answer the question of how bad climate change truly is, typically in US dollars.
To some, meanwhile, the SCC is a lagging indicator of the severity of climate change, perennially behind the latest science. Reliance on the SCC as a guide for policy is, thus, a chief culprit as to why the world is hurling toward the precipice of unmitigated climate change. It is partly against this backdrop that Nicholas Stern and Joseph Stiglitz’s recent working paper, describing an ‘alternative approach’ to the SCC, has found such resonance.
“Recalculate the social cost of carbon” [paywalled]; free full-text PDF
Citation:
Wagner, Gernot. “Recalculate the social cost of carbon,” Nature Climate Change (29 March 2021). doi:10.1038/s41558-021-01018-5
Related: “A tale of two carbon prices,” Bloomberg Green Risky Climate column (19 February 2021); Wagner, Gernot, David Anthoff, Maureen Cropper, Simon Dietz, Kenneth T. Gillingham, Ben Groom, J. Paul Kelleher, Frances C. Moore & James H. Stock. “Eight priorities for calculating the social cost of carbon,” Nature 590 (25 February 2021).