Costing climate change - Climate Change: The Facts - page 82

The IPCC Assessment lists only four studies since 2008 that estimate economic losses
due to climate change. One, by Maddison and Rehdanz, is based on 'self-reported
happiness' and therefore fails key scientific verifiability tests. 9 Of the others, Nordhaus
suggests a loss of GDP of 2.5 per cent with a 3°C warming; 10 a second—by Bosello, Eboli
and Pierfederici—puts the GDP loss at 0.5 per cent for a 1.9°C warming; 11 and a third, by
Roson andvanderMensbrugghe, estimates aGDPloss of1.8percent fora2.3°C increase
and 4.6 per cent loss for a 4.9°C warming. 12 The studies are summarised in Table 1.
There is considerable water-muddying within the IPCC's Fifth Assessment Report
about possible scenarios where much higher warming takes place. But policy has to stay
grounded with the more plausible possibilities. The world is replete with remote dangers
that might just occur and providing for all of these would take up most of global income.
The bottom line is that the cost of global warming that might result from human
activities, as reported by the IPCC, is very small. Moreover, the economists estimating
thesecostshavedonesoonthebasisofsomehighlyunreliableevaluationsofdamagefrom
climate change.
Thus the costs attributed to losses from reduced agricultural output and productivity,
rising sea levels, re-allocation of tourist facilities, river floods and so on are compiled on
a static basis. The costs assume people will not modify their behaviours in response to the
forecasted gradual changes in temperature, precipitation patterns and tides. Responses to
such changes have taken place in the past and should be far more easily accommodated
with the more accurate measurements we enjoy today.