Complexity and the Economics of Climate Change: A Survey and a Look Forward

T. Balint, Francesco Lamperti (), Antoine Mandel, Mauro Napoletano, Andrea Roventini and A. Sapio

Ecological Economics, 2017, vol. 138, issue C, 252-265

Abstract: Climate change is one of the most daunting challenges human kind has ever faced. In the paper, we provide a survey of the micro and macro economics of climate change from a complexity science perspective and we discuss the challenges ahead for this line of research. We identify four areas of the literature where complex system models have already produced valuable insights: (i) coalition formation and climate negotiations, (ii) macroeconomic impacts of climate-related events, (iii) energy markets and (iv) diffusion of climate-friendly technologies. On each of these issues, accounting for heterogeneity, interactions and disequilibrium dynamics provides a complementary and novel perspective to the one of standard equilibrium models. Furthermore, it highlights the potential economic benefits of mitigation and adaptation policies and the risk of under-estimating systemic climate change-related risks.

Keywords: Climate change; Climate policy; Climate economics; Complex systems; Agent-based models; Socio-economic networks (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (83)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolec:v:138:y:2017:i:c:p:252-265

DOI: 10.1016/j.ecolecon.2017.03.032

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