ABM-IAM : optimal climate policy under bounded rationality and multiple inequalities
Safarzyńska, Karolina (Warsaw University)
van den Bergh, Jeroen C. J. M (Universitat Autònoma de Barcelona. Institut de Ciència i Tecnologia Ambientals)

Date:	2022
Abstract:	Despite considerable concern about potentially inequitable effects of climate policy, models fall short in assessing their implications for policy design. To address this issue, we develop an agent-based climate-economy model, agent-based modelling-Integrated Assessment Model, as a disaggregated, behavioural approach to integrated climate assessment. It describes networks of heterogeneous consumers, banks, power plants and firms, and is calibrated on patterns of growth and carbon dioxide emissions generated by the DICE model of Nordhaus. Whereas the latter assumes full employment and abstains from a financial sector and inequality considerations, our approach relaxes these restrictions to obtain a more reliable assessment of climate policy impacts. We show that inequalities in labour and capital income serve as essential but overlooked links between climate-change damages and optimal climate policy. Our result show that lower inequalities of labour income increase the social cost of carbon (SCC), while the impact of capital income inequalities on the SCC depends on the share of population receiving capital rents.
Grants:	European Commission 741087
Note:	Unidad de excelencia María de Maeztu CEX2019-000940-M
Rights:	Aquest document està subjecte a una llicència d'ús Creative Commons. Es permet la reproducció total o parcial, la distribució, la comunicació pública de l'obra i la creació d'obres derivades, fins i tot amb finalitats comercials, sempre i quan es reconegui l'autoria de l'obra original.
Language:	Anglès
Document:	Article ; recerca ; Versió publicada
Subject:	Agent-based modelling ; Social cost of carbon ; Climate policy
Published in:	Environmental research letters, Vol. 17, Issue 9 (September 2022) , art. 094022, ISSN 1748-9326

Adreça alternativa: https://iopscience.iop.org/article/10.1088/1748-9326/ac8b25
DOI: 10.1088/1748-9326/ac8b25

16 p, 6.0 MB

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Research literature > UAB research groups literature > Research Centres and Groups (research output) > Experimental sciences > Institut de Ciència i Tecnologia Ambientals (ICTA) > Environmental and Climate Economics (ECE)
Articles > Research articles
Articles > Published articles