Climate change: Quantifying economic disparity between generations due to climate mitigation

The lifetime economic costs and benefits of climate change mitigation for different generations across countries under the Paris Agreement is estimated in a paper published in Nature Communications. The modelling study suggests that those born prior to 1960 will experience a reduction in GDP as a result of climate change mitigation while those born after 1990 will experience a benefit.

It is understood that the costs and benefits of climate change mitigation are unevenly distributed across time and locations. However, we know relatively little about discrepancies in potential economic disparity between generations and across higher- and lower-income countries.

Haozhe Yang and Sangwon Suh model the potential inter-generational and inter-country economic benefits of climate change mitigation for 169 countries from 2020 to 2100. The authors find that those born prior to 1960 experience a net reduction in lifetime gross domestic product (GDP) per capita across almost all countries, with the effect particularly pronounced in lower-income countries. In contrast, those born after 1990 will gain net economic benefits, particularly in lower-middle-income countries. The authors also indicate that in many higher-income countries, there could be no net benefits for any age cohort. The cost-benefit disparity among different age cohorts may also widen over time, with lower-income countries potentially experiencing a larger cost-benefit disparity between generations, the authors suggest.

The findings indicate that numerous challenges may lie ahead for building climate policy consensus between older and younger generations and across countries with higher and lower incomes, the authors conclude.