Planetary CFO
  • Blog/Home
  • About
  • Ideas
  • Rogues
  • A Finance Manual for the Planet
  • Gallery
  • Contact

Planetary CFO

What AGW damage curve do you prefer?

3/9/2023

0 Comments

 
What AGW damage curve do you prefer?

Attached is figure 9 from Keen (2023) "Loading the DICE Against Pensions".

This illustrates why there is so much to debate about future scenarios for AGW.
We know from the weight of scientific evidence that AGW is happening and is causing damage already, but there is much disagreement about how quickly the future damages from it will build up.

Much hangs on tipping points, estimates of when they will occur and how seriously the damages hit the global economy. The "logistic" curve example shown below anticipates tipping points having such impacts that total loss (ie nearly 100% of global GDP) occurs at some point in the next few decades, in the absence of sufficient actions to address AGW. But it's not the only curve in town ...

Most mainstream economists assume the gentle quadratic curve, which probably explains why many of them aren't overly worried about AGW. Some even suggest that AGW damage will only make a small dent in global GDP, so future generations can sort out AGW at some point in the future when they are richer than generations alive today.

But which curve do you think is the most plausible?
Personally, my view is the logistic (S-shaped) curve is the most plausible, based on tipping points being a real and dangerous threat. If tipping points are at all a meaningful concept, they have to follow a curve such as the logistic S-curve, despite the challenge of working out how to reflect probabilities of various timescales and steepness of accelerations.

In any case, as Ekins and Zenghelis point out, acting on sustainability (including AGW) might well be GDP-positive in itself. That makes acting a no-brainer in any case. The Precautionary Principle aligns with economically optimal pathways on this matter, as we try to prevent the rapid acceleration up the logistic curve.

See also:
FT "Lex in depth: how investors are underpricing climate risks" (17 Aug 2023):
https://lnkd.in/e6ZV35-R

Although it's quite old now, this video is still relevant and persuasive:
https://lnkd.in/eQgiK7jG
Picture
0 Comments



Leave a Reply.

    Author

    The Planetary CFO - working towards a sustainable World Balance Sheet.

    Categories

    All
    Climate Change
    Economics
    Inequality
    Land Use
    Migrants
    Sustainability
    The Role
    Transport
    World Balance Sheet

    Archives

    May 2025
    April 2025
    March 2025
    February 2025
    January 2025
    December 2024
    November 2024
    September 2024
    August 2024
    July 2024
    June 2024
    March 2024
    February 2024
    January 2024
    November 2023
    October 2023
    September 2023
    August 2023
    July 2023
    June 2023
    May 2023
    April 2023
    March 2023
    February 2023
    January 2023
    December 2022
    November 2022
    October 2022
    September 2022
    August 2022
    July 2022
    June 2022
    May 2022
    April 2022
    March 2022
    February 2022
    January 2022
    December 2021
    November 2021
    October 2021
    September 2021
    August 2021
    July 2021
    June 2021
    May 2021
    April 2021
    March 2021
    February 2021
    January 2021
    December 2020
    November 2020
    October 2020
    September 2020
    August 2020
    July 2020
    June 2018
    May 2018
    April 2018
    March 2018
    February 2018
    January 2018
    December 2017
    November 2017
    October 2017
    September 2017
    August 2017
    July 2017
    June 2017
    May 2017
    April 2017
    March 2017
    February 2017
    January 2017
    December 2016
    November 2016
    October 2016
    September 2016
    August 2016
    July 2016
    June 2016
    May 2016
    April 2016
    March 2016
    February 2016
    January 2016
    December 2015
    November 2015

Powered by Create your own unique website with customizable templates.
  • Blog/Home
  • About
  • Ideas
  • Rogues
  • A Finance Manual for the Planet
  • Gallery
  • Contact