China and the United States are the two biggest carbon-emitting countries in the world. Decarbonization in these two countries will have material impacts on a global scale and is timelier than ever, according to a recent report from Stanford University’s Precourt Institute for Energy, Stanford Center at Peking University, APARC's China Program, and Peking University’s Institute of Energy.

The report is the product of a roundtable series, held in October 2021 that brought together leading American and Chinese current and former officials, and experts in the public and private sectors working on energy, climate, the environment, industry, transportation, and finance. The roundtables promoted discussion around how China and the United States can accelerate decarbonization and cooperate with one another to meet their carbon neutrality goals by mid-century.

The thematic areas of the roundtables included U.S.- China collaboration on climate change, global sustainable finance, corporate climate pledges, and the opportunities and challenges for the acceleration of decarbonization in both countries in general, as well as specifically for the power, transportation, and industry sectors.

The resultant report reviews the key themes and takeaways that emerged from the closed-door discussions. It builds on the “U.S.-China Joint Statement Addressing the Climate Crisis” released by the U.S. Department of State on April 17, 2021 and shares some common themes with the “U.S.-China Joint Glasgow Declaration on Enhancing Climate Action in the 2020s” released on November 10, 2021. Shiran Victoria Shen of the Hoover Institution authored the report, with contributions by Yi Cui of the Precourt Institute for Energy, Zhijun Jin of the Institute of Energy and Jean Oi, Director of APARC's China Program. 

The report suggests that tensions in U.S.-China relations have hindered the acceleration of decarbonization and that open science in fundamental research areas must be encouraged. Universities can educate future leaders, advance knowledge, and foster U.S.-China collaboration on open-science R&D, regardless of the political environment. The report argues that the most promising strategy to decarbonize energy is to electrify consumption now served by fossil fuels as much as possible while decarbonizing electricity generation. 

The roundtables identified six areas where the U.S. and China could collaborate: global green finance, carbon capture and storage, low-carbon agriculture and food processing, methane leak reduction, grid integration and greater use of intermittent renewables, and governance, including at the subnational level. The report further identifies more concrete and additional promising areas for accelerated decarbonization and bilateral collaboration, as well as the obstacles to be tackled, including institutional, political, and financial constraints. 

Gaps in social science knowledge of climate change constrain the policy impact of natural science research, a Stanford team argues.

Scientists have made huge strides in understanding the physical and biological dimensions of climate change, from deciphering why climate has changed in the past to predicting how it might change in the future.

As the body of knowledge on the physical science of climate grows, a missing link is emerging: What are the economic and social consequences of changes in the climate and efforts to control emissions of greenhouse gases?

In a new paper in the journal Science, a team led by Stanford professors Charles Kolstad and Marshall Burkeargues that relatively low funding for social science research has contributed to a knowledge gap about what climate change means for human society. This knowledge gap, they argue, renders the large advances in natural science less useful than they could be for policymakers.

The paper highlights three research questions with the greatest potential to close that gap:

What is the true cost of carbon emissions?

The social cost of carbon (SCC) is a dollar value estimate of future social and economic damages caused by each present-day metric ton of carbon emissions. It can also be thought of as the amount of money society saves, in terms of damage avoided, by not emitting an additional metric ton of carbon.

"The SCC is a key policy measurement that's already being used in U.S. government regulations. But existing estimates have shortcomings and these need fixing if we are going to make the correct policy decisions around climate change," said Burke, an assistant professor at Stanford School of Earth, Energy and Environmental Sciences, a center fellow at the Freeman Spogli Institute for International Studies and a faculty fellow at the Stanford Institute for Economic Policy Research.

Current SCC calculations leave out several important factors. For example, what is the economic cost of extreme climate events such as floods and droughts? How should economists estimate "non-market" damages that are exacerbated by climate change, such as armed conflict, disease epidemics and deforestation? In what parts of the world does climate change slow or accelerate economic growth? Can farmers avoid lost income from climate change by adapting their crop choices and planting schedules?

"Getting the social cost of carbon right is most pressing, given its importance to policy," said Kolstad, a senior fellow at the Stanford Institute for Economic Policy Research and at the Precourt Institute for Energy. "It's also an area where rapid research progress should be possible."

What emissions mitigation policies are best?

Once researchers agree on the true cost of carbon, there are many policy options for reducing emissions. Industry regulations and subsidies for renewable energy are popular policy choices for governments all over the world, but they may be weaker at cutting emissions than less politically popular options like carbon pricing or tradeable carbon emission permits.

"Until we understand more about the benefits and tradeoffs of different carbon pricing options, governments are almost flying blind on climate mitigation policy," Kolstad said. "When we can make a clear economic case for one policy over the other, we can better align decisions about carbon pricing systems with their actual costs and benefits and, as a result, strengthen political support for action." 

What role do developing countries play?

Most of the existing research on climate economics tends to focus on wealthy countries, even though developing countries now contribute more total greenhouse gas emissions. Poorer countries also often face a different policy environment than richer countries and are potentially more economically vulnerable to changes in climate.

"We need better evidence on how impacts of climate change might differ in developing countries, as well as a deeper understanding of the climate policy choices faced by developing country governments," Burke said.

Twenty-eight leading economists contributed to the Science paper, a fact that Burke pointed to as evidence of broad consensus on the need for more economic research on climate change.

The biggest roadblock, the authors agree, is funding.

"The research problems are tough for both natural scientists and economists, but research support has been much more modest in economics, so far fewer people are working in the area and progress has been slower," Kolstad said.

"Dozens of teams of physical scientists around the world work with the exact same climate simulations and compare results to estimate future climate change," Burke said.  "Economists are just starting to do something similar, and as this collaboration develops I think it will be immensely valuable. There's a strong argument for spending research dollars on understanding the economic and social implications of that physical science. Social science is relatively cheap, so extra funding can go a long way."

Kolstad encourages young researchers to pursue the "many interesting, socially relevant questions in this field" and advises governments to work together to strengthen long-term research funding and support for graduate students and postdoctoral researchers. "Otherwise," he said, "the large sums spent on natural science will be poorly targeted."

CONTACT:

Charles Kolstad, SIEPR: ckolstad@stanford.edu, (650) 721-1663

Marshall Burke, Earth System Science: mburke@stanford.edu, (650) 721-2203

Laura Seaman, Food Security and the Environment: lseaman@stanford.edu, (650) 723-4920

New research finds that without climate change mitigation, even wealthy countries will see an economic downturn by 2100.

When thousands of scientists, economists and policymakers meet in Paris this December to negotiate an international climate treaty, one question will dominate conversations: what is the climate worth?

A new study published in the journal Nature shows that the global economy will take a harder hit from rising temperatures than previously thought, with incomes falling in most countries by the year 2100 if climate change continues unchecked. Rich countries may experience a brief economic uptick, but growth will drop off sharply after temperatures pass a critical heat threshold.

The study, co-led by Marshall Burke, a professor of Earth system science at Stanford's School of Earth, Energy & Environmental Sciences, provides a clear picture of how climate change will shape the global economy, which has been a critical missing piece for the international climate community leading up to the Paris talks. Understanding how much future climate change will cost in terms of global economic losses will help policymakers at the meetings decide how much to invest in emissions reductions today.

The work was co-authored by two researchers from the University of California, Berkeley: co-lead author Solomon Hsiang, the Chancellor's Associate Professor of Public Policy, and Edward Miguel, Oxfam Professor in Environmental and Resource Economics. 
 

Heat threshold

"The data tell us that there are particular temperatures where we humans are really good at producing stuff," said Burke, who is also Center Fellow at the Freeman Spogli Institute for International Studies and fellow, by courtesy, at the Stanford Woods Institute for the Environment. "In countries that are normally quite cold - mostly wealthy northern countries - higher temperatures are associated with faster economic growth, but only to a point. After that point, growth declines rapidly.

That point, it turns out, is an annual average temperature of about 55 degrees Fahrenheit.

As average temperatures move past that mark, wealthy countries will start to see a drop-off in economic output. Poorer countries, mostly in the tropics, will suffer even steeper losses because they are already past the temperature threshold. This has the potential to widen the global inequality gap, said Burke. 
 

A new approach

Looking at existing research, the team found a puzzling mismatch between micro-level studies, which show negative impacts of hot temperatures on output in specific sectors such as agriculture, and macro-level studies, which at least in rich countries show limited impacts on economic output.

"Many very careful studies show clearly that high temperatures are bad for things like agriculture and labor productivity, even in rich countries," Burke said. "While these relationships showed up again and again in the micro data – for example when looking at agricultural fields or manufacturing plants – they were not showing up in the existing macro-level studies, and we wanted to understand why."

The researchers suspected the problem was with the analysis, not the data, so they took a new approach.

Analyzing records from 166 countries over a 50-year period from 1960 to 2010, they compared each country's economic output in years of normal temperatures to that of unusually warm or unusually cool years. The data revealed a hill-shaped relationship between economic output and temperature, with output rising until the 55 F threshold and then falling faster and faster at higher temperatures. “Our macro-level results lined up nicely with the micro-level studies,” Hsiang said. 
 

Two possible future. Colors are 2100 temperatures under “business as usual” climate change (left) and aggressive climate policy (right). This image shows a simulation of future nightlights, as seen from space, since richer economies tend to glow brighter. A hotter world is a more unequal world, with the north benefitting and tropical economies declining. A cooler world leads to more equitable global growth, offering regions like Africa the chance to “catch up”. Courtesy of Marshall Burke.

Two possible future. Colors are 2100 temperatures under “business as usual” climate change (left) and aggressive climate policy (right). This image shows a simulation of future nightlights, as seen from space, since richer economies tend to glow brighter. A hotter world is a more unequal world, with the north benefitting and tropical economies declining. A cooler world leads to more equitable global growth, offering regions like Africa the chance to “catch up”. Source: Burke, Hsiang and Miguel. 
 

Higher temperatures, lower growth

The team then sought to understand what this historical pattern might mean for the future global economy as temperatures continue to warm. 

“Many other researchers have projected economic impacts under future climate change,” Hsiang said. “But we feel our results improve our ability to anticipate how societies in coming decades might respond to warming temperatures.”

Projecting future changes in economic output under climate change was challenging.

“Even without climate change, there are a lot of possible ways in which the future economy might evolve,” Burke said. “We start with a few different baseline scenarios and then we bring in our historical understanding of the relationship between temperature and economic output to better understand how these economic trajectories might change with warming temperatures."

The researchers’ findings were stark. 

In a scenario of unmitigated climate change, the team’s model shows that by 2100 the per-capita incomes of 77 percent of countries in the world would fall relative to current levels. By the team’s main estimate, global incomes could decline 23 percent by 2100, relative to a world without climate change. Other estimates are twice as high. The likelihood of global economic losses larger than 20 percent of current income is at least 40 percent, and much higher in some scenarios. 

These estimates are substantially larger than existing models indicate, a difference the research team attributes to their updated and data-driven understanding of how countries have historically responded to temperature increases.

Rich countries not immune

A common assumption among researchers has been that wealth and technology protect rich countries from the economic impacts of climate change, because they use these resources to adapt to higher temperatures.

"Under this hypothesis, the impacts of future warming should lessen over time as more countries become richer," Burke said. "But we find limited evidence that this is the case."

Burke's team found that, historically, rich countries did not appear to respond any differently to temperature change than poor countries. 

“The data definitely don’t provide strong evidence that rich countries are immune from the effects of hot temperatures,” said Hsiang.  “Many rich countries just happen to have cooler average temperatures to start with, meaning that future warming will overall be less harmful than in poorer, hotter countries.”

Paris climate talks

From Nov. 30 to Dec. 11, France will host the 21st Session of the Conference of the Parties to the United Nations Framework Convention on Climate Change (COP21/CMP11).

More than 40,000 delegates from national governments, private companies and civil society will meet in Paris to hash out an international agreement aimed at keeping global emissions low enough to prevent warming of more than two degrees Celsius.

On the table are three key issues: climate adaptation, mitigation and financing.

"We don't want to rule out that we could see unprecedented adaptation to hotter temperatures in the future, and we certainly hope we do see it," Burke said. "The historical evidence, though, suggests that this is not something we should count on."

The team says that mitigation, and how to pay for it, should be at the forefront of discussions in Paris.

"Our research is important for COP21 because it suggest that these economic damages could be much larger than current estimates indicate," said Burke. "What that means for policy is that we should be willing to spend a lot more on mitigation than we would otherwise. The benefits of action on mitigation are much greater than we thought, because the costs of inaction are much greater than we thought."

Note for reporters: The research team has created a website about their research results and methodology, including an interactive map showing country-by-country GDP projections through 2100 under a scenario of unmitigated climate change.

This past Thursday, on the 10th of November 2011, former U.N. Secretary-General, Kofi Annan delivered a speech at Stanford University on the occasion of the launch of the Freeman Spogli Institute for International Studies' Center on Food Security and the Environment. Citing UN estimates, more precisely the UNFPA State of the World Population 2011 report, he highlighted that the world population had recently reached seven billion and growing. Advancements in healthcare and technology have increased our life expectancy, affording 'man' the ability to escape a life that is, in Hobbesian parlance, "poor, nasty, brutish, and short." Yet this apparent human success story eclipses the "shameful failure" of the international community to address an indiscernible fact: that in the contemporary technological age, an astonishing number of people in the world go hungry each day. The marriage of a globalized economy and scientific innovation was supposed to - at least in theory - increase and spread wealth and resources to enhance the human condition. And yet today - talks of unfettered markets and the financial crisis aside -, we lay witness to close to one billion people around the world who lack food security (both chronic and transitory). Citing numbers from the World Bank, Annan stated that rapidly rising food prices since 2010 have "pushed an additional 70 million people into extreme poverty". Adding to these disturbing figures is the fact that one of the world's most ravenous culprits of infanticide is no other than hunger, which claims the young lives of 17,000 children every day.

Dwindling incentives to farm and increasing pressures on farmers are not helping the food insecurity crisis. Frequently, companies who contract local farmers to produce cash crops for export do not employ "strategic agricultural planning" or take into account the impact their policies and modus operandi may have on local farming communities and their immediate (food) needs. Artificially low prices for agricultural goods force farmers from their land and discourage investment in the sector, Annan warns. Agricultural subsidies in the US and Europe against farm produce injected into the market by farmers from developing countries have also added to the problem. Agricultural subsidies in Europe in particular have had a devastating impact on farmers from other parts of the world - mostly in Asia and Africa - who simply cannot compete with the existing market conditions and the low price tags attached to their goods. This phenomenon is most acute in Africa where a significant segment of the population lives modestly by working the land and these subsidies are choking the lifeline that feeds their families. To bring home the point of the sheer imbalance between the conditions of Western farmers and the 'rest', Annan stated that with a fraction of the funds generated by a reduction of subsidies, one "can fly every European cow around the world first class and still have money left over". Without a more balanced approach to international trade policy making, subsidies will continue to be a factor in food insecurity.

And it gets worse. The 'Four Horsemen of the Apocalypse' of our times - (i) an ever emerging global water crisis, (ii) land misuse and degradation, (iii) climate change, and (iv) kleptocratic governance - have combined to aggravate an already dire international food insecurity predicament. The hard truth is that without countering the forward gallop of these ills, food insecurity cannot be adequately addressed.

The facts on the ground and projections into the future do not paint a promising picture. Food prices are expected to rise by 50 percent by the year 2050, Annan warns, and this at a time when the world will be home to two billion more inhabitants. In 40 years from now, there simply isn't enough food to nourish and satisfy the world's population.

The growing world food crisis also stifles development. It is the cyclical brutality of poverty that keeps the hungry down. Without the means or access to proper and adequate nutrition, the impoverished who are always the first victims of food insecurity invariably suffer from poor health, in turn resulting in low productivity. This vicious cycle traps the less privileged to a seemingly inescapable downward spiral.

During the course of his poignant remarks, Annan stated that without addressing food insecurity "the result will be mass migration, growing food shortages, loss of social cohesion and even political instability". He is correct on all counts.

The fact is that a world which 'cultivates' and then neglects the hungry is a dangerous and volatile world. Since time immemorial, dramatic human migrations have had a direct correlation with changes in climate, habitat and resource scarcity. Survival instincts are engrained in our genetic make-up. When the most basic and fundamental necessities of life are sparse and hard to come by, our natural inclination is to look for 'greener pastures'. An unaddressed and lingering food insecurity crisis will mean the world will witness significant and rapid migration trends in the 21st century (a phenomenon very much in motion today). The injection of mass flows of people into other foreign populations will cause friction and conflict induced by integration challenges, both social and economic (surmountable, but conflicts no less).

Moreover, the desperation and unmet basic needs of the underprivileged can translate into open outbursts of conflict and violence. Tranquility and social harmony are virtues enjoyed by countries that can provide for their people. Leaving the growing food insecurity dilemma unaddressed will be to invite inevitable political instability and violence in countries and fragile regions of the world grappling with high poverty rates and concomitant food insecurity challenges. More often than not, history has shown a positive nexus between hunger and social upheaval (it bears noting that La Grande Révolution of 1789-99 was preceded by slogans of "Du pain, du pain!"). Further, it does not take too much of a forethought to recognize that it is precisely in environments of destitute and despondency where autocratic rule can easily take root and grow to inflict further suffering.

Food insecurity can also lead to wars, but similarly wars contribute to food insecurity by destroying both the land and the ability to cultivate the land. Conflict represents formidable barriers to the access and availability of otherwise usable land (countries like Somalia, Sudan, Burundi, Ethiopia and Liberia come to mind).

To be sure, "[w]ithout food, people have only three options: they riot, they emigrate or they die" (borrowed from the often cited words of Josette Sheeran, the Executive Director of the UN World Food Program).

How are we to tackle this grave problem in a realistic and effective manner? Annan rightly tells us that the "[l]ack of a collective vision is irresponsible". Implicit in Annan's remarks is also a lack of leadership to effectively tackle and untie the Gordian Knot of food insecurity. The nature and colossal character of food insecurity demands action and cooperation on a global scale. Climate change and its negative impact on the environment - e.g. diminishing arable lands, water resources, recurring drought -, one of the accelerators of food insecurity, requires robust and committed international agreement and action to reduce the emission of greenhouse gases. Strict adherence and compliance with the Kyoto Protocol and the Copenhagen Accord are a must in this regard. With strategic agricultural planning, knowledge transfer and investment, uncultivated arable lands - abundant in many parts of the world, including in Africa - can become productive and bear fruit, reducing in turn the hunger crisis. Efforts to implement more balanced international trade policies which make farming viable across continents as well as efforts to eradicate corruption (by promoting good governance) are also part and parcel of the fight against hunger. So are innovative ways of thinking about establishing, say rapid response mechanisms to preempt and effectively counter famine and other food emergencies by bolstering the capacities of relevant existing international and regional organizations. We could also reduce the threat of hunger by doing more than just pay lip-serve to the UN Millennium Development Goals (MDGs) and uphold our commitments to the MDGs through sustained funding and support.

The UN and other multilateral bodies and pacts are tools we have created to work collaboratively - as best as human frailties permit - to confront global challenges and ills that threaten the social fabric of human society (whether they be food insecurity, dearth in development, war and the crimes that emanate from aggression which threaten peace and security, inter alia). Our capacity to reason, innovate, communicate and cooperate is hence an indispensible tool in our struggle to keep the peace, to protect our fundamental human rights and to satisfy our most basic needs for survival. It's time to put these faculties to work in confronting the world's food security challenges.

It is only fitting to conclude these brief remarks by quoting from the man and the lecture that inspired them. "If we pool our efforts and resources we can finally break the back of this problem", stated Annan in his call for action to defeat food insecurity. If there's a will, history tells us, change is within grasp, no matter how daunting the task. It only takes the trinity of courage, commitment and leadership.