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Climatic Change

, Volume 117, Issue 3, pp 515–530 | Cite as

The uncertainty about the social cost of carbon: A decomposition analysis using fund

Article

Abstract

We report the results of an uncertainty decomposition analysis of the social cost of carbon as estimated by FUND, a model that has a more detailed representation of the economic impact of climate change than any other model. Some of the parameters particularly influence impacts in the short run whereas other parameters are important in the long run. Some parameters are influential in some regions only. Some parameters are known reasonably well, but others are not. Ethical values, such as the pure rate of time preference and the rate of risk aversion, therefore affect not only the social cost of carbon, but also the importance of the parameters that determine its value. Some parameters, however, are consistently important: cooling energy demand, migration, climate sensitivity, and agriculture. The last two are subject to a large research effort, but the first two are not.

Keywords

Risk Aversion Social Cost Time Preference Climate Sensitivity Income Elasticity 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

Notes

Acknowledgements

Financial support by the CEC-DG RTD ClimateCost project is gratefully acknowledged.

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Copyright information

© Springer Science+Business Media Dordrecht 2013

Authors and Affiliations

  1. 1.School of Natural Resources and EnvironmentUniversity of MichiganAnn ArborUSA
  2. 2.Department of EconomicsUniversity of SussexEast SussexUK
  3. 3.Institute for Environmental StudiesVrije UniversiteitAmsterdamThe Netherlands
  4. 4.Department of Spatial EconomicsVrije UniversiteitAmsterdamThe Netherlands

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