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Valuing climate impacts in integrated assessment models: the MIT IGSM

Abstract

We discuss a strategy for investigating the impacts of climate change on Earth’s physical, biological and human resources and links to their socio-economic consequences. As examples, we consider effects on agriculture and human health. Progress requires a careful understanding of the chain of physical changes—global and regional temperature, precipitation, ocean acidification, polar ice melting. We relate those changes to other physical and biological variables that help people understand risks to factors relevant to their daily lives—crop yield, food prices, premature death, flooding or drought events, land use change. Finally, we investigate how societies may adapt, or not, to these changes and how the combination of measures to adapt or to live with losses will affect the economy. Valuation and assessment of market impacts can play an important role, but we must recognize the limits of efforts to value impacts where deep uncertainty does not allow a description of the causal chain of effects that can be described, much less assigned a likelihood. A mixed approach of valuing impacts, evaluating physical and biological effects, and working to better describe uncertainties in the earth system can contribute to the social dialogue needed to achieve consensus on the level and type of mitigation and adaptation actions.

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Correspondence to John Reilly.

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This article is part of a Special Issue on “Improving the Assessment and Valuation of Climate Change Impacts for Policy and Regulatory Analysis” edited by Alex L. Marten, Kate C. Shouse, and Robert E. Kopp.

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Reilly, J., Paltsev, S., Strzepek, K. et al. Valuing climate impacts in integrated assessment models: the MIT IGSM. Climatic Change 117, 561–573 (2013). https://doi.org/10.1007/s10584-012-0635-x

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  • DOI: https://doi.org/10.1007/s10584-012-0635-x

Keywords

  • Ozone
  • Surface Ozone
  • Integrate Assessment Model
  • Computable General Equilibrium Model
  • Social Account Matrix