Aggregate economic measures of climate change damages: explaining the differences and implications

The aggregate economic measures of damage from climate change have been a focus of attention for several decades, but have become the subject of particular interest and debate in recent years. They are usually reported in a number of different ways: as equivalent costs of global or national economic product in a future period or for a future temperature; as a present value where all future costs are discounted back to a point in time; or as the incremental damage that can be attributed to a marginal increase in emissions, known as the social cost of carbon. This article outlines these aggregate economic measures and assesses the key assumptions and inputs in the estimates, and how these influence the aggregated results. Finally, it discusses the strengths and weaknesses of the estimates and their potential role and applicability for policy. (C) 2011 John Wiley & Sons, Ltd. WIREs Clim Change 2011 2 356-372 DOI:10.1002/wcc.111