Global annual disaster costs

by Fran Sussman

A recent post on CD&S asked what we might learn from the economic impacts of disasters about ways to minimize the long term effects on the economy of these extreme weather events.

The post was a response to reading a recent article, “Global Cost Estimates from “Informing Climate Adaptation:  A Review of the Economic Costs of Natural Disasters,” by Carolyn Kousky, which appears in the journal, Energy Economics.  Although the focus in the article is on the conceptual basis of the estimates rather than the story told by the numbers, the author does pull together some estimates and the results are rather striking.   (more…)

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The Unfunded Mandate of Climate Change

by Fran Sussman

A recent post here on CD&S argued that greater attention should be paid to the literature on economic impacts of climate change in the National Climate Assessment.  That argument has been taken a step further in a report from the Center on American Progress (CAP), coauthored by Fran Sussman (CD&S) with Cathleen Kelly (CAP) and Kate Gordon of The Next Generation (TNG).  The report, Climate Change: An Unfunded Mandate, argues that, by failing to take aggressive action on climate change, Congress is imposing an unfunded mandate on the budgets of state, local, and tribal governments—the costs of repairing and rebuilding infrastructure, treating illness, making institutional change, and preparing for the future by making human systems and infrastructure more resilience to projected climate change. (more…)

Lessons from empirical studies of the costs of extreme weather events

by Fran Sussman

A critical gap in our knowledge about the economic costs of climate change is the cost of extreme events. Until earlier this week, the calmness of this Fall’s hurricane season had lulled  the public and policy makers into a sense that perhaps we have more time. But the devastation and loss in life caused when Typhoon Haiyan—among the worst in history—slammed into the Philippines has quickly dispelled any developing sense of security about extreme events.  As we make choices concerning the types and magnitude of investments and institutional changes we need to make for the future, the question arises, “Is there anything to be learned from studies of the costs of extreme events about how to prepare—how much to spend on prevention and preparedness, or where to target investments?” (more…)

Take a Poll: How do you think we should make decisions about global climate change?

Yesterday’s post on Paul Krugman’s review of The Climate Casino, by Bill Nordhaus, raised the question of the usefulness of benefit-cost analysis for assessing the global costs and benefits of climate change.  Most–but not all–economists tacitly accept this approach.

What about you?  If not benefit-cost analysis, then what approach do you think we should use?

Take a poll and record how you would like to decide “how much climate change is enough?” (more…)

Paul Krugman on Bill Nordhaus and Climate Change: Insights not Answers

by Fran Sussman

Paul Krugman’s review of Bill Nordhaus’s recent book, The Climate Casino: Risk, Uncertainty, and Economics for a Warming World, is thoughtful and informative.  But it unintentionally raises some difficult questions about the role of benefit-cost analysis in assessing the consequences of climate policy, and whether focusing on this type of analysis draws resources and attention away from other, more important topics in economics.

Benefit-cost analysis of global climate change is fundamentally either an academic exercise or one intended to shape public opinion.  The Climate Casino is a little of both. (more…)

The aggregate cost of adapting to climate change in the US

by Fran Sussman

Not too long ago, I co-authored an article, “Climate change adaptation cost in the US:  What do we know?” which surveyed the state of knowledge on adaptation costs in the U.S.  The article is forthcoming in Climate Policy and a pre-publication version of the article is available on the short papers page.  While the article made strides in expanding our understanding of the literature on adapting to climate change in the U.S., there was one thing it did not do—tell us how much is is going to cost.  This post takes a stab at that. (more…)

Economics in the National Climate Assessment

by Fran Sussman

The draft National Climate Assessment (NCA)—which became available for review this past January–is the third to be produced since the Global Change Act of 1990 (P.L. 101-606) mandated that the U.S. Global Change Research Program (USGCRP) provide Congress and the President with periodic assessments of trends in global climate and the impacts of global change on natural and human systems in the U.S. Despite providing an impressive review of the literature on the science and physical effects of climate change, the assessment does not—intentionally—take the next step of assessing what we know about projected economic impacts and adaptation costs. (more…)

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