A new study from University College London published Tuesday in the journal Environmental Research Letters suggests that previous economic models projecting the costs imposed on the global community by global warming could underestimate the costs for the rest of the century by a factor of 6 .
This could be a critical error and a gap on the part of modelers and planners in projecting the costs imposed by inadequate efforts to move away from fossil fuels. Current projections are vital for governments in calculating the financial risks and benefits of reducing global greenhouse gas emissions. The biggest problem with current projections, as this study shows, is the short-term focus on the costs imposed by climate change. There seems to be an almost unspoken assumption that extreme weather and climate events have short-term and easily calculable costs, but these costs are not effectively factored into much longer time periods. In other words, the costs are fixed on the short-term impacts.
As summarized in phys.org, a weekly publication of the American Physics Association: “Extreme events like droughts, fires, heat waves and storms are likely to cause long-term economic damage due to their impact. on health, savings and labor productivity.
Because the economic costs during this century are not correctly modeled to include long-term economic damage, the international team of scientists wanted to define a more reliable range based on a widely used climate cost model. They found that global GDP due to economic impacts could be 37% lower, compared to the 6% figure in the previous study. This underestimation, they found, would be due to the failure to include long-term impacts added to recognized short-term impacts. Based on the findings of the new study, this would mean that the climate cost model underestimates costs by a factor of 6.