More rain on the parade
The Political Economy of Weak Treaties
Marco Battaglini & Bård Harstad
NBER Working Paper, December 2016
Abstract:
In recent decades, democratic countries have signed hundreds of international environmental agreements (IEAs). Most of these agreements, however, are weak: they generally do not include effective enforcement or monitoring mechanisms. This is a puzzle in standard economic models. To study this phenomenon, we propose a positive theory of IEAs in which the political incumbents negotiate them in the shadow of reelection concerns. We show that, in these environments, incumbents are prone to negotiate treaties that are simultaneously overambitious (larger than what they would be without electoral concerns) and weak (might not be implemented in full). The theory also provides a new perspective for understanding investments in green technologies, highlighting a channel through which countries are tempted to rely too much on technology instead of sanctions to make compliance credible. We present preliminary evidence consistent with these predictions.
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Melting Ice Caps and the Economic Impact of Opening the Northern Sea Route
Eddy Bekkers, Joseph Francois & Hugo Rojas-Romagosa
Economic Journal, forthcoming
Abstract:
One consequence of melting Arctic ice caps is the commercial viability of the Northern Sea Route, connecting East Asia with Europe. This represents a sizeable reduction in shipping distances and average transportation days compared to the conventional Southern Sea Route. We examine the economic impact of opening this route in a multi-sector Eaton-Kortum model with intermediate linkages. We find remarkable shifts in trade flows between Asia and Europe, diversion of trade within Europe, heavy shipping traffic in the Arctic and a substantial drop in Suez traffic. Projected shifts in trade also imply substantial pressure on an already threatened Arctic ecosystem.
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Hurricane intensification along United States coast suppressed during active hurricane periods
James Kossin
Nature, 19 January 2017, Pages 390–393
Abstract:
The North Atlantic ocean/atmosphere environment exhibits pronounced interdecadal variability that is known to strongly modulate Atlantic hurricane activity. Variability in sea surface temperature (SST) is correlated with hurricane variability through its relationship with the genesis and thermodynamic potential intensity of hurricanes. Another key factor that governs the genesis and intensity of hurricanes is ambient environmental vertical wind shear (VWS). Warmer SSTs generally correlate with more frequent genesis and greater potential intensity, while VWS inhibits genesis and prevents any hurricanes that do form from reaching their potential intensity. When averaged over the main hurricane-development region in the Atlantic, SST and VWS co-vary inversely, so that the two factors act in concert to either enhance or inhibit basin-wide hurricane activity. Here I show, however, that conditions conducive to greater basin-wide Atlantic hurricane activity occur together with conditions for more probable weakening of hurricanes near the United States coast. Thus, the VWS and SST form a protective barrier along the United States coast during periods of heightened basin-wide hurricane activity. Conversely, during the most-recent period of basin-wide quiescence, hurricanes (and particularly major hurricanes) near the United States coast, although substantially less frequent, exhibited much greater variability in their rate of intensification, and were much more likely to intensify rapidly. Such heightened variability poses greater challenges to operational forecasting and, consequently, greater coastal risk during hurricane events.
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The impact of climate change on developed economies
Ding Du, Xiaobing Zhao & Ruihong Huang
Economics Letters, forthcoming
Abstract:
We use sub-national data to examine the relationship between temperature and growth within the United States and the European Union. Different from previous studies based on national data, we find that the optimal temperature is much lower. Because most of production takes place in areas with temperatures above the optimal temperature, projected temperature increases have significantly negative impact on the economic growth of the United States and the European Union. Our results suggest more proactive climate policy.
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Climate change may speed democratic turnover
Nick Obradovich
Climatic Change, January 2017, Pages 135–147
Abstract:
The electoral fate of incumbent politicians depends heavily upon voters’ well-being. Might climate change – by amplifying threats to human well-being – cause incumbent democratic politicians and parties to lose office more frequently? Here I conduct the first-ever investigation of the relationship between temperature, electoral returns, and future climate change. Using data from over 1.5 billion votes in over 4,800 electoral contests held in 19 countries between 1925 and 2011, coupled with meteorological data, I show that increases in annual temperatures above 21 °C (70 °F) markedly decrease officeholders’ vote share. I combine these empirical estimates with an ensemble of climate models to project the impact of climate change on the fate of future officeholders. Resulting forecasts indicate that by 2099 climate change may reduce average incumbent party vote share across all nations in the sample, with the most acute worsening occurring in poorer countries. If realized, these predictions indicate that climate change could amplify future rates of democratic turnover by causing incumbent parties and their politicians to lose office with increasing frequency.
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Winter is Coming: The Long-Run Effects of Climate Change on Conflict, 1400-1900
Murat Iyigun, Nathan Nunn & Nancy Qian
NBER Working Paper, January 2017
Abstract:
We investigate the long-run effects of cooling on conflict. We construct a geo-referenced and digitized database of conflicts in Europe, North Africa, and the Near East from 1400-1900, which we merge with historical temperature data. We show that cooling is associated with increased conflict. When we allow the effects of cooling over a fifty-year period to depend on the extent of cooling during the preceding period, the effect of cooling on conflict is larger in locations that experienced earlier cooling. We interpret this as evidence that the adverse effects of climate change intensify with its duration.
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Tropical Cyclones Downscaled from Simulations with Very High Carbon Dioxide Levels
Robert Korty et al.
Journal of Climate, January 2017, Pages 649–667
Abstract:
A method to simulate thousands of tropical cyclones using output from a global climate model is applied to simulations that span very high surface temperatures forced with high levels of carbon dioxide (CO2). The climatology of the storms downscaled from a simulation with modern-day conditions is compared to that of events downscaled from two other simulations featuring 8 and 32 times preindustrial-era levels of CO2. Storms shift poleward with warming: genesis locations and track densities increase in subtropical and higher latitudes, and power dissipation increases poleward of 20°S and 30°N. The average latitude at which storms reach their maximum intensity shifts poleward by more than 1.5° latitude in the 8 × CO2 experiment and by more than 7° latitude in the 32 × CO2 case. Storms live longer and are more numerous in both of the warmer climates. These increases come largely from an expansion of the area featuring favorable conditions into subtropics and midlatitudes, with some regions of the Arctic having the thermodynamic conditions necessary to sustain systems in the hottest case. Storms of category 5 intensity are 52% more frequent in the 8 × CO2 experiment but 40% less so in the 32 × CO2 case, largely owing to a substantial decline in low-latitude activity associated with increases in a normalized measure of wind shear called the ventilation index. Changes in genesis and track densities align well with differences in the ventilation index, and environmental conditions become substantially more favorable poleward of about 20° latitude in the warmer climates.
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Steven Desch et al.
Earth's Future, forthcoming
Abstract:
As the Earth's climate has changed, Arctic sea ice extent has decreased drastically. It is likely that the late-summer Arctic will be ice-free as soon as the 2030s. This loss of sea ice represents one of the most severe positive feedbacks in the climate system, as sunlight that would otherwise be reflected by sea ice is absorbed by open ocean. It is unlikely that CO2 levels and mean temperatures can be decreased in time to prevent this loss, so restoring sea ice artificially is an imperative. Here we investigate a means for enhancing Arctic sea ice production by using wind power during the Arctic winter to pump water to the surface, where it will freeze more rapidly. We show that where appropriate devices are employed, it is possible to increase ice thickness above natural levels, by about 1 m over the course of the winter. We examine the effects this has in the Arctic climate, concluding that deployment over 10% of the Arctic, especially where ice survival is marginal, could more than reverse current trends of ice loss in the Arctic, using existing industrial capacity. We propose that winter ice thickening by wind-powered pumps be considered and assessed as part of a multi-pronged strategy for restoring sea ice and arresting the strongest feedbacks in the climate system.
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Samuel Brilleman et al.
Social Science & Medicine, January 2017, Pages 118–125
Abstract:
Disasters occur frequently in the United States (US) and their impact on acute morbidity, mortality and short-term increased health needs has been well described. However, barring mental health, little is known about the medium or longer-term health impacts of disasters. This study sought to determine if there is an association between community-level disaster exposure and individual-level changes in disability and/or the risk of death for older Americans. Using the US Federal Emergency Management Agency's database of disaster declarations, 602 disasters occurred between August 1998 and December 2010 and were characterized by their presence, intensity, duration and type. Repeated measurements of a disability score (based on activities of daily living) and dates of death were observed between January 2000 and November 2010 for 18,102 American individuals aged 50–89 years, who were participating in the national longitudinal Health and Retirement Study. Longitudinal (disability) and time-to-event (death) data were modelled simultaneously using a ‘joint modelling’ approach. There was no evidence of an association between community-level disaster exposure and individual-level changes in disability or the risk of death. Our results suggest that future research should focus on individual-level disaster exposures, moderate to severe disaster events, or higher-risk groups of individuals.
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Long-Run Consequences of Exposure to Natural Disasters
Krzysztof Karbownik & Anthony Wray
Northwestern University Working Paper, November 2016
Abstract:
We utilize the individual-level World War I Draft Registration Cards matched to late-nineteenth century hurricane paths and the 1940 U.S. Census to explore whether fetal and early childhood exposure to stress caused by hurricanes affects human capital development and labor market outcomes in adulthood. Difference-in-differences estimates indicate that white males who were born in the South and experienced a hurricane either in utero or as infants had lower income at ages 42 to 53. They are robust to alternate specifications of either the treatment or outcome variables, as well as changes in the tolerance for imperfectly matched historical data.
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Joshua Graff Zivin & Matthew Kahn
NBER Working Paper, December 2016
Abstract:
How will a nation’s aggregate urban productivity be affected by climate change? The joint distribution of climate conditions and economic activity across a nation’s cities will together determine industrial average exposure to climate risk. Air conditioning (AC) can greatly reduce this heat exposure. We develop a simple model of air conditioning adoption by heterogeneous firms within an industry. Our analysis suggests that high productivity firms are more likely to adopt AC since they suffer larger productivity losses when it is hot. Given that the most productive firms produce a disproportionate share of industry-level output, we present aggregation results highlighting how the industry’s output is insulated from the heat. Our empirical analysis of the impacts of heat on total factor productivity in U.S manufacturing yields findings broadly consistent with our model’s predictions.
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Are environmentally responsible firms less vulnerable when investing abroad? The role of reputation
Rémi Bazillier, Sophie Hatte & Julien Vauday
Journal of Comparative Economics, forthcoming
Abstract:
Globalization allows multinational firms to locate strategically the polluting activities in lax countries. This paper revisits the empirical evidence by exploiting heterogeneity in firms’ environmental image. While locating in countries with weak environmental standards is likely to be detrimental for a firm’s image and reputation, investing in corporate environmental responsibility can help firms to convince consumers that they have good environmental practices, even when investing in the “dirty” countries. Exploiting an original database that records an index of environmental responsibility for large European firms, we find that the firms viewed as environment-friendly are more often than others located in countries with weak environmental regulations. We show that our findings are not likely to be driven by omitted variables bias, specific sectors nor particular countries. Interestingly, this relationship is observed only among the firms with a well-established reputation for environmental responsibility.
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Temperature Shocks and the Cost of Equity Capital: Implications for Climate Change Perceptions
Ronald Balvers, Ding Du & Xiaobing Zhao
Journal of Banking & Finance, April 2017, Pages 18–34
Abstract:
Financial market information can provide an objective assessment of losses anticipated from temperature changes. In an APT model in which temperature shocks are a systematic risk factor, the risk premium is significantly negative, loadings for most assets are negative, and asset portfolios in more vulnerable industries have stronger negative loadings on a temperature shock factor. Weighted average increases in the cost of equity capital attributed to uncertainty about temperature changes are 0.22 percent, implying a present value loss of 7.92 percent of wealth. These costs represent a new channel that may contribute to cost of climate change assessment.
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Income Inequality and Carbon Emissions in the United States: A State-level Analysis, 1997–2012
Andrew Jorgenson, Juliet Schor & Xiaorui Huang
Ecological Economics, April 2017, Pages 40–48
Abstract:
This study investigates the relationship between U.S. state-level CO2 emissions and two measures of income inequality: the income share of the top 10% and the Gini coefficient. Each of the inequality measures, which focus on unique characteristics of income distributions, is used to evaluate the arguments of different analytical approaches. Results of the longitudinal analysis for the 1997 to 2012 period indicate that state-level emissions are positively associated with the income share of the top 10%, while the effect of the Gini coefficient on emissions is non-significant. The statistically significant relationship between CO2 emissions and the concentration of income among the top 10% is consistent with analytical approaches that focus on political economy dynamics and Veblen effects, which highlight the potential political and economic power and emulative influence of the wealthy. The null effect of the Gini coefficient is generally inconsistent with the marginal propensity to emit approach, which posits that when incomes become more equally distributed, the poor will increase their consumption of energy and other carbon-intensive products as they move into the middle class.
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Regional and global sea-surface temperatures during the last interglaciation
Jeremy Hoffman et al.
Science, 20 January 2017, Pages 276-279
Abstract:
The last interglaciation (LIG, 129 to 116 thousand years ago) was the most recent time in Earth’s history when global mean sea level was substantially higher than it is at present. However, reconstructions of LIG global temperature remain uncertain, with estimates ranging from no significant difference to nearly 2°C warmer than present-day temperatures. Here we use a network of sea-surface temperature (SST) records to reconstruct spatiotemporal variability in regional and global SSTs during the LIG. Our results indicate that peak LIG global mean annual SSTs were 0.5 ± 0.3°C warmer than the climatological mean from 1870 to 1889 and indistinguishable from the 1995 to 2014 mean. LIG warming in the extratropical latitudes occurred in response to boreal insolation and the bipolar seesaw, whereas tropical SSTs were slightly cooler than the 1870 to 1889 mean in response to reduced mean annual insolation.
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Centuries of thermal sea-level rise due to anthropogenic emissions of short-lived greenhouse gases
Kirsten Zickfeld, Susan Solomon & Daniel Gilford
Proceedings of the National Academy of Sciences, 24 January 2017, Pages 657–662
Abstract:
Mitigation of anthropogenic greenhouse gases with short lifetimes (order of a year to decades) can contribute to limiting warming, but less attention has been paid to their impacts on longer-term sea-level rise. We show that short-lived greenhouse gases contribute to sea-level rise through thermal expansion (TSLR) over much longer time scales than their atmospheric lifetimes. For example, at least half of the TSLR due to increases in methane is expected to remain present for more than 200 y, even if anthropogenic emissions cease altogether, despite the 10-y atmospheric lifetime of this gas. Chlorofluorocarbons and hydrochlorofluorocarbons have already been phased out under the Montreal Protocol due to concerns about ozone depletion and provide an illustration of how emission reductions avoid multiple centuries of future TSLR. We examine the “world avoided” by the Montreal Protocol by showing that if these gases had instead been eliminated in 2050, additional TSLR of up to about 14 cm would be expected in the 21st century, with continuing contributions lasting more than 500 y. Emissions of the hydrofluorocarbon substitutes in the next half-century would also contribute to centuries of future TSLR. Consideration of the time scales of reversibility of TSLR due to short-lived substances provides insights into physical processes: sea-level rise is often assumed to follow air temperature, but this assumption holds only for TSLR when temperatures are increasing. We present a more complete formulation that is accurate even when atmospheric temperatures are stable or decreasing due to reductions in short-lived gases or net radiative forcing.
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Mitigation potential and global health impacts from emissions pricing of food commodities
Marco Springmann et al.
Nature Climate Change, January 2017, Pages 69–74
Abstract:
The projected rise in food-related greenhouse gas emissions could seriously impede efforts to limit global warming to acceptable levels. Despite that, food production and consumption have long been excluded from climate policies, in part due to concerns about the potential impact on food security. Using a coupled agriculture and health modelling framework, we show that the global climate change mitigation potential of emissions pricing of food commodities could be substantial, and that levying greenhouse gas taxes on food commodities could, if appropriately designed, be a health-promoting climate policy in high-income countries, as well as in most low- and middle-income countries. Sparing food groups known to be beneficial for health from taxation, selectively compensating for income losses associated with tax-related price increases, and using a portion of tax revenues for health promotion are potential policy options that could help avert most of the negative health impacts experienced by vulnerable groups, whilst still promoting changes towards diets which are more environmentally sustainable.
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Overlooked possibility of a collapsed Atlantic Meridional Overturning Circulation in warming climate
Wei Liu et al.
Science Advances, January 2017
Abstract:
Changes in the Atlantic Meridional Overturning Circulation (AMOC) are moderate in most climate model projections under increasing greenhouse gas forcing. This intermodel consensus may be an artifact of common model biases that favor a stable AMOC. Observationally based freshwater budget analyses suggest that the AMOC is in an unstable regime susceptible for large changes in response to perturbations. By correcting the model biases, we show that the AMOC collapses 300 years after the atmospheric CO2 concentration is abruptly doubled from the 1990 level. Compared to an uncorrected model, the AMOC collapse brings about large, markedly different climate responses: a prominent cooling over the northern North Atlantic and neighboring areas, sea ice increases over the Greenland-Iceland-Norwegian seas and to the south of Greenland, and a significant southward rain-belt migration over the tropical Atlantic. Our results highlight the need to develop dynamical metrics to constrain models and the importance of reducing model biases in long-term climate projection.
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Global projections of river flood risk in a warmer world
L. Alfieri et al.
Earth's Future, forthcoming
Abstract:
Rising global temperature has put increasing pressure on understanding the linkage between atmospheric warming and the occurrence of natural hazards. While the Paris Agreement has set the ambitious target to limiting global warming to 1.5°C compared to pre-industrial levels, scientists are urged to explore scenarios for different warming thresholds and quantify ranges of socio-economic impact. In this work, we present a framework to estimate the economic damage and population affected by river floods at global scale. It is based on a modeling cascade involving hydrological, hydraulic and socio-economic impact simulations, and makes use of state-of-the-art global layers of hazard, exposure and vulnerability at 1 km grid resolution. An ensemble of seven high-resolution global climate projections based on Representative Concentration Pathways (RCP) 8.5 is used to derive streamflow simulations in the present and in the future climate. Those were analyzed to assess the frequency and magnitude of river floods and their impacts under scenarios corresponding to 1.5°C, 2°C, and 4°C global warming. Results indicate a clear positive correlation between atmospheric warming and future flood risk at global scale. At 4°C global warming, countries representing more than 70% of the global population and global GDP will face increases in flood risk in excess of 500%. Changes in flood risk are unevenly distributed, with the largest increases in Asia, America and Europe. In contrast, changes are statistically not significant in most countries in Africa and Oceania for all considered warming levels.