Seven Recommendations for Pricing Greenhouse Gas Emissions
This journal article features seven recommendations for improving estimates of the social cost of greenhouse gas emissions.
Abstract
The social cost of greenhouse gases is important in many regulatory impact analyses. However, calculations of the social cost of greenhouse gases are highly complex and periodically revisited. We offer seven recommendations to improve current estimates. These include recommendations to use both country-level and global measures of the social cost of greenhouse gases, to use country-specific values for monetizing climate damages, to represent uncertainties by reporting distributions instead of using only central values, and to conduct a temporal distributional analysis that shows the magnitudes of climate damages across generations. We also provide recommendations for the discount rates that should be used when estimating the social cost of greenhouse gases, and the appropriate discount rates for regulatory impact analyses that include the social cost of greenhouse gases.
Authors
John D. Graham
Indiana University
Kerry M. Krutilla
Indiana University
Randall Lutter
Manhattan Institute
Jason Shogren
University of Wyoming
Linda Thunström
University of Wyoming
W. Kip Viscusi
Vanderbilt University
