Climate change has cost the United States over $350 billion over the last decade, and costs are expected to rise, according to a report released Tuesday by the U.S. Government Accountability Office.
Nicholas Sanders, an environmental economist and assistant professor of Policy Analysis and Management at Cornell University, says new technologies and future migration patterns complicate cost predictions.
“The GAO report does a good job of considering the complexities that arise with trying to project costs into the future, such as discounting – allowing for proper comparison of costs and benefits at different points in time – and the role of future technology.
“A major challenge of estimating costs of climate change comes from uncertainty, and not just in expected climate. Technological and social adaptation will play a large role in costs of adjustment. Air conditioning, for example, dramatically changed the temperature and health relationship in the last half-century, but such advancements are difficult to forecast.
“Information on the potential costs of climate change should play an important role in the formation of effective and efficient policy, both now and in the future. From an efficiency standpoint, benefit-cost analysis of potential policies requires quality estimates of how investment today might pay off with avoided costs in the future.”
Ariel Ortiz-Bobea, an agricultural economist and assistant professor in the Charles H. Dyson School of Applied Economics and Management at Cornell University, says more work needs to be done to understand the economic cost of climate change on agriculture.
“The GAO report sheds light on a crucial trade-off facing the nation. To recognize that greenhouse gas emissions have ‘side-effects’ and can be, in many cases, harmful to different parts of the economy is the first step toward responsible policy-making.
“Regarding the analysis of U.S. agriculture, the report remains incomplete as it only considers the effects on field crops, which constitute only about a third of the sector.
“Reducing the adverse effects of climate change on U.S. agriculture will require a combination of strategies, including reducing emissions, but also enhancing the ability of U.S. farmers to adapt.
“Some of my research shows that farmers in certain U.S. regions are specializing into increasingly climate-sensitive production. This is likely due to various policies that nudge farmers into specializing into specific crops. It is urgent for the U.S. government to take a comprehensive approach to climate-change adaptation and consider the role of policies that inadvertently make U.S. agriculture more vulnerable to climate.”