Coupled Climate-Economy-Ecology (CoCEB) Modeling: A Dynamic Approach

24 Pages Posted: 12 Nov 2020

See all articles by Keroboto B.Z. Ogutu

Keroboto B.Z. Ogutu

Department of Mathematics and Physical Sciences, School of Science, Dedan Kimathi University of Technology

Fabio D'Andrea

affiliation not provided to SSRN

Andreas Groth

Imperial College Business School; Ecole Normale Supérieure

Michael Ghil

University of California, Los Angeles (UCLA); Ecole Normale Supérieure

Date Written: September 22, 2020

Abstract

The when and/or how improved environmental-performance leads to improved macroeconomic-performance under increasing likelihood of global-warming abatement are not well understood. We thus formulate a simple Stochastic Coupled Climate-Economy-Biosphere (CoCEB-S) model that is qualitatively oriented—it is constructed to account for the main global macroeconomic and climate facts and is designed, in particular, to offer insights toward sustainable climate policy formulation. The paper begins with climate, carbon-cycle, and biosphere modules. A detailed description of stylized long-run macroeconomic facts and the core framework for replicating them, along with an extension to include endogenous technological-change, endogenous population, and energy depletion is added. Climate affects economic activity through damage appearing in the macroeconomic structure. The results show that abatement delivers a win-win solution by ~2050. However, the non-business-as-usual mitigation measures are wrought with high unemployment rates. This paper therefore demonstrates that a sustainable climate policy should be reinforced with appropriate economic measures that restrain the threat for the employment market and the possible high income/wealth disparity.

Keywords: Integrated assessment, Energy-climate policy, Inclusive wealth index, Endogenous technology, Endogenous population, Energy depletion, Damage mitigation, Endogenous variability

JEL Classification: C65, Q33, Q44, Q54, Q57, Q58

Suggested Citation

Ogutu, Keroboto B.Z. and D'Andrea, Fabio and Groth, Andreas and Ghil, Michael, Coupled Climate-Economy-Ecology (CoCEB) Modeling: A Dynamic Approach (September 22, 2020). Available at SSRN: https://ssrn.com/abstract=3697299 or http://dx.doi.org/10.2139/ssrn.3697299

Keroboto B.Z. Ogutu

Department of Mathematics and Physical Sciences, School of Science, Dedan Kimathi University of Technology ( email )

Private Bag
Dedan Kimathi, 10143
Kenya

Fabio D'Andrea

affiliation not provided to SSRN

Andreas Groth (Contact Author)

Imperial College Business School ( email )

South Kensington Campus
Exhibition Road
London SW7 2AZ, SW7 2AZ
United Kingdom

Ecole Normale Supérieure

24 rue Lhomond
Paris cedex 05, 75230
France

Michael Ghil

University of California, Los Angeles (UCLA) ( email )

405 Hilgard Avenue
Box 951361
Los Angeles, CA 90095
United States

Ecole Normale Supérieure ( email )

24 rue Lhomond
Paris Cedex 05, 75231
France

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