The Economic Geography of Global Warming



José-Luis Cruz and Esteban Rossi-Hansberg | Becker Friedman Institute at The University of Chicago

The world is getting warmer due to carbon emissions generated by the economic activity of humans. Global carbon emissions will affect temperatures everywhere over long periods of time and in geographically heterogeneous ways. What will be the impact of carbon emissions, and the implied changes in temperatures, on the world economy and on the economy of particular regions? How will individuals react to these changes and how are these reactions impacted by their ability to migrate, trade, or invest and develop alternative centers of economic activity? What are the best policies to combat global warming and what are their implications for different regions across the world? In this paper we propose and quantify a novel global spatial dynamic assessment model to address these questions.


To read the full report from the Becker Friedman Institute at The University of Chicago, please click here