A recent study predicts that due to climate change, the global economy may see a 19% decrease in income by 2050, based on data from over 1,600 regions. The estimated annual economic damages by 2050 are around $38 trillion, largely due to past emissions affecting agriculture, labor, and infrastructure. This cost is six times greater than the expense of limiting global warming to two degrees. Source: SciTechDaily.com
A new study has been published that suggests even with significant reduction in CO2 emissions starting now, the global economy is set to experience a 19% decrease in income by 2050 due to climate change impacts. These economic damages are six times higher than the costs needed to keep global warming below a two-degree threshold. Nature A new study published in
suggests that even with significant reductions in CO2 emissions starting today, the global economy is poised to experience a 19% decrease in income by 2050 due to the impacts of climate change. According to the study, the economic damages are six times greater than the costs required to keep global warming under a two-degree threshold. Empirical data from over 1,600 regions worldwide over the last 40 years was used by scientists at the Potsdam Institute for Climate Impact Research (PIK)
to evaluate the future effects of changing climate conditions on economic growth and their durability.
Extensive economic costs are also anticipated for the United States and the European Union.
“Our analysis shows that climate change will cause significant economic damages within the next 25 years in nearly all countries globally, including highly-developed ones such as Germany, France, and the United States,” says PIK scientist Leonie Wenz who led the study. “These short-term damages are a consequence of our previous emissions. More efforts in adaptation are required to mitigate at least some of them. Drastic and immediate reduction of emissions is necessary – if not, the economic losses will become even greater in the latter half of the century, reaching up to 60% on the global average by 2100. This clearly demonstrates that it is much more cost-effective to protect the climate, even without considering non-economic impacts such as loss of life or biodiversity.”
Projected income changes in 2049 compared to an economy without climate change. Income changes are committed in the sense that they are caused by historical emissions. Source: Kotz et al., Nature
Until now, global estimates of economic damages from climate change have predominantly focused on national impacts from average annual temperatures over long periods. By incorporating the latest empirical discoveries from climate impacts on economic growth in over 1,600 subnational regions worldwide over the past 40 years and focusing on the next 26 years, the researchers managed to forecast sub-national damages from changes in temperature and rainfall in great detail across time and space, while also reducing the considerable uncertainties linked with long-term projections. The scientists combined empirical models with cutting-edge climate simulations (CMIP-6). Importantly, they also evaluated how persistently climate impacts have influenced the economy in the past and took this into consideration.
Countries least responsible will suffer the most
“Our research shows that climate impacts are very unfair: We see damage almost everywhere, but countries in the tropics will suffer the most because they are already warm. More temperature increases will be especially harmful there. The countries least responsible for climate change are expected to experience a 60% greater income loss compared to higher-income countries and a 40% greater loss than higher-emission countries.
These countries also have the fewest resources to adjust to its effects. It is up to us to decide: we need a fundamental shift toward a renewable energy system for our safety and to save money. Continuing on our current path will result in disastrous consequences. The planet's temperature can only be stabilized if we stop burning oil, gas, and coal,” stated Anders Levermann, Head of Research Department Complexity Science at the Potsdam Institute and co-author of the study.
Reference: “The economic commitment of climate change” by Maximilian Kotz, Anders Levermann and Leonie Wenz, 17 April 2024, Nature.
DOI: 10.1038/s41586-024-07219-0
