ESTIMATES OF THE EXTERNAL AND SUSTAINABILITY COSTS OF CLIMATE CHANGE

Weak sustainability is typically defined as non-declining utility, or perhaps non-declining production capacity. Weak sustainability places human welfare at the core, and substituting one source of welfare for another is not an issue (e.g., Pearce and Turner, 1990; Perman et al., 1999). As climate change is unlikely to reverse economic growth (Fankhauser and Tol, 2001; Tol, 1998), it is compatible with weak sustainability. However, climate change does pose an efficiency problem, as greenhouse gas emissions are externalities, and perhaps large ones (Pearce et al., 1996; Smith et al., 2001). Therefore, our first approach to measuring climate change is to estimate the marginal external costs of carbon dioxide emissions.

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