Modeling Climate Change: Sensitivities of The Social Cost of Carbon Under Parametric Uncertainty
Open Access
Author:
Morey, Austin
Area of Honors:
Economics
Degree:
Bachelor of Science
Document Type:
Thesis
Thesis Supervisors:
Marc Albert Henry, Thesis Supervisor Russell Paul Chuderewicz, Thesis Honors Advisor
Keywords:
economics climate change integrated assessment modeling uncertainty social cost of carbon
Abstract:
The economics of climate change combines research from a wide range of physical sciences and economic theory into complex mathematical models called integrated assessment models. This study analyzes the impact of parametric uncertainty in these models as they calculate the social cost of carbon, a vital tool for policymaking. Uncertainty in total factor productivity growth, population growth, and equilibrium climate sensitivity are addressed for three prominent integrated assessment models, DICE, FUND, and PAGE. Through regression analysis, uncertainty in the equilibrium climate sensitivity parameter is shown to influence the social cost of carbon more than other inputs. The results of this study also support the use of a recently developed method of analyzing uncertainty in integrated assessment modeling of climate change.
