ERG Colloquium: Inequality and the Social Cost of Carbon

Energy and Resource group

Wednesday, March 06, 2019


David Anthoff
Assistant Professor
Energy and Resources Group
University of California, Berkeley

DATE: Wednesday, March 6, 2019
TIME: 4:00-5:30pm
PLACE: 126 Barrows

TITLE: Inequality and the Social Cost of Carbon

We present a novel way to disentangle inequality aversion over time from inequality aversion between regions in the computation of the social cost of carbon. Our approach nests a standard efficiency based estimate and an equity weighted estimate as special cases. We use two integrated assessment models (FUND and RICE) to present quantitative estimates of the social cost of carbon. Our results suggest that inequality considerations lead to higher (lower) social cost of carbon values in high (low) income regions relative to an efficiency based approach, but that the effect is less strong than found in previous studies that used equity weighting. Our central estimate is that the social cost of carbon increases roughly by a factor of two to three, and even more for higher degrees of inequality aversion, when our disentangled equity weighting approach is used.

David Anthoff is an environmental economist who studies climate change and environmental policy. He co-develops the integrated assessment model FUND that is used widely in academic research and in policy analysis. His research has appeared in Science, the Journal of Environmental Economics and Management, Environmental and Resource Economics, the Oxford Review of Economic Policy and other academic journals. He contributed a background research paper to the Stern Review and has advised numerous organizations (including US EPA and the Canadian National Round Table on the Environment and the Economy) on the economics of climate change.

He is an assistant professor in the Energy and Resources Group at the University of California, Berkeley. Previously he was an assistant professor in the School of Natural Resources and Environment at the University of Michigan, a postdoc at the University of California, Berkeley and a postdoc at the Economic and Social Research Institute in Ireland. He also was a visiting research fellow at the Smith School of Enterprise and the Environment, University of Oxford.

He holds a Ph.D. (Dr. rer. pol.) in economics from the University of Hamburg (Germany) and the International Max Planck Research School on Earth System Modelling, a M.Sc. in Environmental Change and Management from the University of Oxford (UK) and a M.Phil. in philosophy, logic and theory of science from Ludwig-Maximilians-Universität München (Germany).