The Economics of Climate Change
In, S. Y. and Park, K. Y. (2021). "The Economics of Climate Change." The Korean Journal of Economics, 28(1), 137-199.
Posted: 30 Jun 2021
Date Written: June 29, 2021
This study aims to provide a comprehensive review of key issues related to climate change to economists. For this purpose, we first discuss the established scientific facts of climate change and then discuss their implications to the economy and the field of economics. We start with explaining scientific consensus on climate change, types of climate risks and measures to mitigate them, need for international cooperation and the current state of South Korea. We then elaborate on economic perspectives of climate change and highlights the critical roles of economic research in this subject. In particular, we cover key discussions on economic modeling such as integrated assessment model (IAM), carbon pricing of carbon tax and cap & trade, climate finance, climate stress test, and green new deal. After reviewing key issues, we call for prompt attention from economists and policymakers to address since South Korea is facing relatively higher transition risks to low carbon economy.
Keywords: Climate Change, Carbon Pricing, Green New Deal, IAM (Integrated Assessment Model), Climate Finance
JEL Classification: A11, Q54
Suggested Citation: Suggested Citation