Costs Of Paris Agreement
Below, we submit our results to numerous robustness tests. First, we add to the climate change sensitivity analysis in the main text by taking into account a total probability density function for ECS values. Second, we look at the effects of uncertainty in BHM`s estimates. In this regard, we take into account other estimates of 1 and 2, on the one hand, and different model specifications, on the other. This analysis is followed by a comparison with the DJO estimates. Third, we study the influence of uncertainty on the socio-economic future by recalibrate the DICE model based on a selected group of SSPs. As a by-product of this calibration, we obtain mitigation and cost functions that emulate the costs of a detailed process model and thus represent a further evolution of the DICE model. The derivation of these functions allows us to test the sensitivity of our results to these alternative emission reduction costs. We complete this section by providing more information on the robustness test for the preferred parameters shown in the main text. The Paris climate agreement aims to keep temperature rises well below 2 degrees Celsius. This involves mitigation and prevention costs for climate damage. Here we show that the agreement is the economically optimal political path for the century, regardless of normative assumptions of inequality aversion and temporal preferences. To this end, we systematically integrate a cost-damage curve that replicates the observed ratio of temperature to economic growth in the DICE integrated assessment model.
We thus offer an inter-temporally optimized cost-benefit analysis of the climate problem of this century. We take into account uncertainties regarding the damage curve, sensitivity to climate change, socio-economic future and mitigation costs. The resulting optimal temperature is robust, as can be understood based on the overall temperature of mitigation costs and the level of damage resulting from the observed temperature-growth relationship. Our results show that the politically motivated Paris climate agreement is also an economically advantageous route if properly implemented. While mitigation and adjustment require more climate funding, adjustment has generally received less support and has mobilized fewer private sector actions.  A 2014 OECD report showed that in 2014, only 16% of the world`s financial resources were devoted to adaptation to climate change.  The Paris Agreement called for a balance between climate finance between adaptation and mitigation, highlighting in particular the need to strengthen support for adaptation from the parties most affected by climate change, including least developed countries and small island developing states. The agreement also reminds the parties of the importance of public subsidies, as adjustment measures receive less public sector investment.  John Kerry, as Secretary of State, announced that the United States would double its grant-based adjustment funding by 2020.
 On August 4, 2017, the Trump administration formally communicated to the United Nations that the United States intends to withdraw from the Paris Agreement as soon as it is legally entitled to do so.  The formal declaration of resignation could not be submitted until after the agreement for the United States came into force on November 4, 2019 for a three-year date.   On November 4, 2019, the U.S. government filed the withdrawal notice with the Secretary-General of the United Nations, custodian of the agreement, and formally withdrew from the Paris Agreement a year later, when the withdrawal came into effect.  After the November 2020 elections, President-elect Joe Biden promised to reinstate the United States in the Paris Agreement for his first day in office and renew the U.S. commitment to climate change mitigation.   To date, BHM`s estimates have proven to be fairly high social costs for carbon9, indicating that the reduction in emissions will have to be