Policy research working paper 5392:
This paper confronts the wide political support for the 2C objective of global increase in temperature, reaffirmed in Copenhagen, with the extreme assumptions about pure time preference or climate change damages. It demonstrates the uncertainty of adaptation costs by questioning the reliability of climate model validation and projections, the unknown ecosystem reaction to large warming, the difficulty in mobilizing the full capacity of adaptation potentials in case of very fast environmental change, the risks of mis-adaptation, the inertia of capital stocks, and many sources of ripple effect within the economic system. It also warns on the money spent for climate mitigation not been spent elsewhere and calls for a solution giving monetary values to possible risks, through the introduction of a willingness to pay for avoiding poorly understood but potentially serious risks.
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