Study by UC Berkeley professors links economic inequality, climate change

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A study published Tuesday by UC Berkeley professors concluded that unmitigated climate change will reduce the average person’s income by 23 percent and increase the global inequality gap by 2100.

The researchers conducted the study by comparing economic data from the World Bank with climatological data and then analyzing it using econometric processes. According to the study’s estimate, 77 percent of countries will become poorer than they would have been without climate change.

The study was led by UC Berkeley associate professor of public policy Solomon Hsiang, campus professor of environmental and resource economics edward Miguel, and Stanford University assistant professor of earth system science Marshall Burke.

The research team also found that climate change will increase the global inequality gap, with the poorest 40 percent of countries experiencing a reduction in income by nearly 75 percent by 2100. Researchers found that because poorer countries tend to be warmer, they are more negatively affected by increasing temperatures. Richer, colder countries, on the other hand, may experience slight increases in productivity.

“(Climate change) is causing major trauma for almost half the world’s population that’s much poorer than we are. … We should know that’s what these actions are doing,” Hsiang said.

The team used data for only temperature change, excluding other variables such as rising sea levels and increasing numbers of hurricanes predicted by global warming.

This study is not the first to predict negative effects on the economy due to anticipated climate change, but its results are much more extreme. The predicted cost estimates are 2.5 to 100 times larger than in previous models.

According to Hsiang, a lot of the team’s research is concerned with understanding the consequences of climate change so that funding can be allocated to its prevention in the most effective way. He said that the more dramatic results suggest that more money should be invested into prevention but that he doesn’t know “what the right number is.”

Bill Stewart, co-director of UC Berkeley’s Center for Forestry and Center for Fire Research and Outreach, said in an email that this study approached a problem many other researchers have but in a different way.

“Most economic studies also predict negative economic activity from climate change but they use models that have more sophisticated economic components to try to capture technological innovation and investments,” Stewart said in an email.

He said the use of historical data may make some of the predictions inaccurate because of factors unaccounted for, such as current social, economic and political states. This study, he said, equates Russia with Canada based on their climates but doesn’t take into account that Canada is “better maintained” and will likely adapt better to climate change.

Within the study, the researchers noted that “unprecedented innovation or defensive investments” might reduce the predicted effects.

Contact Pressly Pratt at [email protected] and follow her on Twitter at @prezzliray.