- مبلغ: ۸۶,۰۰۰ تومان
- مبلغ: ۹۱,۰۰۰ تومان
We present a model based on Keynesian aggregate demand and labor productivity growth to study how climate damage affects the long-run evolution of the economy. Climate change induced by greenhouse gas lowers profitability, reducing investment and cutting output in the short and long runs. Short-run employment falls due to deficient demand. In the long run productivity growth is slower, lowering potential income levels. Climate policy can increase incomes and employment in the short and long runs while a continuation of business-as-usual leads to a dystopian income distribution with affluence for few and high levels of unemployment for the rest.
4. Discussion by Way of a Conclusion
This paper supplements existing attempts to integrate economic and geophysical modeling of climate damage by focusing specifically on the impacts of climate change on the demand side of the economy. This is an important aspect because much of the existing literature makes the controversial assumption that economic institutions automatically lead to the full utilization of productive resources, and because many impacts of climate change immediately affect demand and the distribution of income, which is closely related to demand. Our demand-driven growth framework allows us to study the medium- to long-run impacts of climate damage and mitigation on variables like the utilization rate, unemployment, and wages. The endogenous processes of labor productivity growth, distribution, and employment are essential to our analysis. This allows us to model the economic growth (i.e. growth in income) as an outcome generated in capitalist societies by policies rather than a policy variable itself.
As an anonymous referee for this journal usefully points out, there is a considerable difference in the credibility of the BAU and mitigation scenarios in our simulations. The BAU scenario implies that the world economic/geophysical system will encounter unprecedented conditions, such as a 7 °C average temperature increase, for which we have little or no empirical historical evidence. We present these BAU simulations as a tentative attempt to quantify the unquantifiable, and to identify key points, both economic and geophysical, where major contradictions are likely to occur. These contradictions might involve catastrophic non-linear geophysical responses to extreme economic stresses, but equally well might involve revolutionary changes in the institutions that at present organize world economic production due to geophysical stresses.