Climate Economics

Overview

This program, which ended in September 2012, aimed to expose fundamental flaws in conventional economic models of climate change (and other environmental issues), and build a robust body of work to counter them.

The scientific evidence for climate change is ominous and compelling, but conventional economic analyses have fueled arguments against vigorous, near-term climate policy initiatives, suggesting that climate-change mitigation would be impossibly expensive, reinforcing widespread cynicism about the cost of government initiatives. SEI's research showed that some of those models are deeply flawed and built on questionable assumptions, and presented alternative economic analyses to add new perspectives, considering equity questions, for example, that are often ignored in conventional economic models.

The Climate Economics Group at SEI-US played a unique role in the analysis of climate change and the development of climate policy. Its goal was to create a rigorous, science-based, and accessible economic analysis that demonstrates the urgency and feasibility of large-scale solutions to the climate crisis. This broad objective defined our role within the climate change community in two fundamental respects:

• It addressed the economics, not the science, of climate change, challenging the widespread, mistaken belief that climate policy would be ruinously expensive, potentially worse than the impacts of climate change itself. Sound, science-based economics shows the truth is the opposite: unchecked climate change would threaten ways of life and standards of living, while the costs of stabilizing the climate are relatively modest.
• It developed tools for use by advocates, policymakers, and teachers, but did not itself advocate specific policies. Its popular reports can be used to counter claims about the high cost of taking action; its academic publications can be used to influence IPCC and government reports that rely on peer-reviewed research; and its reframing and reconstruction of climate economics can influence teaching and research in many venues.

Contact

For more information, contact the SEI-US communications manager, Marion Davis.