TABLE 5-8 Marginal Global Damages from GHG Emissions: Estimates from Widely Used Models



Marginal GHG Damage ($/ton CO2)

Discount Rate (%)a

Climate-Warming Scenario

Total Global Climate Damage (% GDP)


Nordhaus (2008)




No control: 3.1°C in 2100; 5.3°C in 2200

Optimal: 2.6°C in 2100; 3.5°C in 2200

−1.8% at 2.5°C

−4.5% at 4.0°C

−7.1% at 5.0°C

−10.2% at 6.0°C


Tol (2005a)d







No control: 3.7°C in 2100; 6.7°C in 2200

~0% at 2.5°C

~ −1% at 4.0°C

~ −1% at 5.0°C


Hope (2006)c

Hope and Newbery (2008)

6 (1-17)

22 (4-60)

108 (21-284)




No control: 4.1°C in 2100; 7.9°C in 2200

−1.0% at 2.5°C

−2.6% at 3.9°C

−11.3% at 7.4°C


Stern (2007)




No control: 3.9°C in 2100; 7.4°C in 2200

Stabilize at 550 ppm CO2-eq: eventual 3°C

−1.0% at 2.5°C

−2.6% at 3.9°C

−11.3% at 7.4°C

NOTE: Negative numbers indicate a negative impact on GDP.

aDiscount rate changes over time in Nordhaus (2008) and Hope (2006); the approximate effective discount rate is given.

bFor PAGE model, mean global GDP impacts are given in Dietz et al. (2007), including market, nonmarket, and risk of catastrophic impacts.

cMean estimate for 2001 emissions with 5th-95th percentile confidence interval from uncertainty analysis in parentheses.

dEstimate is for emissions in 2000 from FUND version 2.4.

eEstimate is for emissions in 2005.

warming (that is, it is one point on the function) and an assumed temperature level corresponding to zero damages. A linear relationship (that is, percentage of climate damages per degree temperature change is constant) corresponds to a power of 1, and a quadratic or cubic relationship corresponds to a damage exponent of 2 or 3. The DICE model (Nordhaus 2008), for example, assumes a quadratic damage function based on Nordhaus and Boyer (2000), yielding estimates of global climate damages increasing over fourfold from −1.8% to −8.2% of world GDP for a twofold increas in temperature from 3°C to 6°C. The PAGE model (Hope 2006), on the other hand, allows for a damage exponent ranging from 1 to 3, with an

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