Economic Damages from Climate Change to U.S. Populations: Integrating Evidence from Recent Studies
Paper Number: 2025-01
Document Date: 1/2025
Author(s): Elizabeth Kopits, Daniel Kraynak, Bryan Parthum, Lisa Rennels, David Smith, Elizabeth Spink, Charles Griffiths, Joseph Perla, Nshan Burns, and Michael Howerton
Subject Area(s): economic damages/benefits, climate change
JEL Classification: C60, D61, Q54, Q58
Keywords: integrated assessment models, benefit-cost analysis, economic damages, climate change
Abstract: This paper takes a step forward in synthesizing recent evidence on estimating climate change damages specific to U.S. populations. We first present the findings from (1) existing global and U.S. models that take an enumerative approach to estimating market and nonmarket damages of climate change, (2) new impact-specific studies that have not yet been incorporated into the larger models, and (3) recent macroeconomic studies that empirically estimate the relationship between climate change and U.S. GDP. We then incorporate damage functions based on the results of these different lines of evidence into a consistent modeling framework to show what this literature implies for U.S. impact-specific social cost of greenhouse gas estimates under harmonized socioeconomic and emissions inputs, climate modeling, and discounting methods. We find that evidence on U.S.-specific damages from existing enumerative type models is still incomplete in the categories of impacts that are represented. Emerging research indicates that some missing categories, such as wildfire damages, are likely to be especially consequential to U.S. populations. Evidence from macroeconomic studies indicates that the U.S. GDP-based market damages from GHG emissions are also substantial. Combining lines of evidence on market and nonmarket damages based solely on the enumerative damage function approach provides preliminary results of U.S.-specific social cost of carbon (SC-CO2) estimates on the order of $40 or more per metric ton of CO2 for 2030 emissions. Combining evidence on GDP-based market damages with evidence on nonmarket health damages (heat- and cold-related mortality) yields U.S.-specific SC-CO2 estimates ranging from $31-85 for 2030 emissions. We discuss the many categories of market and nonmarket impacts omitted from this analysis and highlight the need for more research on climate damages to U.S. populations, not only resulting from individual direct impacts of climate change occurring within U.S. borders, but also through interaction effects and international spillover impacts.
This paper is part of the Environmental Economics Working Paper Series.