Climate Change Bets and Julian Simon versus Paul Ehrlich Again

 A nuanced blog post about the damage that we will suffer because of climate change.

Given all of the uncertainty associated with climate change, it is important to distinguish a few dimensions of this uncertainty;

#1

Will we face more frequent and more severe weather events going forward in time?

I believe that the answer is yes because I believe that global GHG emissions will continue to rise.

#2

Will such punches thrown by Mother Nature cause more damage over time in terms of lives lost and $ of damage destroyed?

I believe the answer is “no” .  Each day we are becoming better at adapting to such shocks because of rising human capital, our rising income, and our access to better information and markets.  I believe that the Social Cost of Carbon is declining over time (Holding the atmospheric GHG level fixed).  So my prediction here is  a first cousin of Julian Simon’s in his famous bet with Paul Ehrlich.  

Over time,  the world’s GHG emissions grow but our ability to adapt to shocks increases.  This means that a researcher who graphs the economic damage caused by climate change with respect to time can actually observe lower damage over time if our adaptation progress exceeds the growth in GHG emissions.