The marginal damage costs of carbon-dioxide emissions’

By Richard S. J. Tol. 2005

1,082 citations recorded by the source corpus.

One hundred and three estimates of the marginal damage costs of carbon dioxide emissions were gathered from 28 published studies and combined to form a probability density function. The uncertainty is strongly right-skewed. If all studies are combined, the mode is $2/tC, the median $14/tC, the mean $93/tC, and the 95 percentile $350/tC. Studies with a lower discount rate have higher estimates and much greater uncertainties. Similarly, studies that use equity weighing, have higher estimates and larger uncertainties. Interestingly, studies that are peer-reviewed have lower estimates and smaller uncertainties. Using standard assumptions about discounting and aggregation, the marginal damage costs of carbon dioxide emissions are unlikely to exceed $50/tC, and probably much smaller.

Subfields: Economics and Econometrics, Renewable Energy, Sustainability and the Environment

View Paper: https://www.semanticscholar.org/paper/43d67eca867c23885fad429383aeea7e8a44ff82

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Citations in the corpus

A Review of the Stern Review (2006, methodology): “Moreover, studies by Fankhauser and Tol (2005) and Tol (forthcoming) that incorporate climate change explicitly show that climate change will have a limited effect on development.”
Automobile Externalities and Policies (2007, background): “Beginning with Vickrey (1969), models began to appear analyzing “bottleneck” congestion, which results when traffic flow temporarily exceeds capacity at a point, either because of a spike in demand or a sudden reduction in road capacity, such as an intersection with obstructing cross traffic or an a”
Plan or React? Analysis of Adaptation Costs and Benefits Using Integrated Assessment Models (2011, background): “A meta-analysis by Tol (2005) provides good insights into the uncertainties involved in damage estimates at the global level; clearly, the uncertainties are much larger at the regional level.”
Using Loopholes to Reveal the Marginal Cost of Regulation: The Case of Fuel-Economy Standards (2011, background): “per ton ( Tol 2005 ), the Stern Report (2006) concludes that the benefit of reducing carbon”
The Stern Review of the Economics of Climate Change: A Comment (2006, neutral): “…et al. (2001) and Easterly and Levine (2003) , who argue that climate has at most a minor, indirect effect in the (distant) past – and the climate-change-specific studies of Fankhauser and Tol (2005) and Tol (forthcoming), who show that climate change will have a limited effect on development.”
Global estimates of the impact of a collapse of the West Antarctic ice sheet: an application of FUND (2005, background): “Hence, while it is economically rational to protect – the alternative would be an even greater loss — the burden may be more than the economy can bear (cf. Fankhauser and Tol 2005).”
The internalization of externalities in the production of electricity: Willingness to pay for the attributes of a policy for renewable energy (2008, neutral): “Most of the results in the abatement cost literature are in the range of 5 to 125 US$/tCO2, but they are also subject to high uncertainty (Tol, 2005).”
The Polluter Pays Principle and Cost-Benefit Analysis of Climate Change: An Application of Fund (2006, neutral): “The first scenario is the business as usual, or no emission control scenario.”
Evaluating the costs of desalination and water transport (2005, background): “Citation: Zhou, Y., and R. S. J. Tol (2005), Evaluating the costs of desalination and water transport, Water Resour.”
A social cost of carbon for (almost) every country (2019, background): “…and Stock, 2017; Pindyck, 2017a,b; Pizer et al., 2014; Revesz et al., 2017) and its application (Greenstone et al., 2013; Hahn and Ritz, 2015; Heyes et al., 2013; Rose, 2012; Sunstein, 2014), as well as meta-analyses (Havranek et al., 2015; Tol, 2005, 2009, 2011, 2013, 2018; Wang et al., 2018).”
Multi-Gas Emission Reduction for Climate Change Policy: An Application of Fund (2006, methodology): “Based on a meta-analysis of 28 studies, Tol (2005a) estimates that the current Pigou tax on carbon dioxide emissions should be $7/tC.”