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  1. The effects of climate change on natural systems will be substantial, widespread, and likely irreversible. Warmer temperatures and changing precipitation patterns have already contributed to forest dieback and pushed some species toward extinction. Natural systems contribute to human welfare both as an input to the production of consumption goods and through the provision of nonuse values (i.e., existence and bequest values). But because they are often unpriced, it can be difficult to constrain these benefits. Understanding how climate change effects on the natural capital stock affect human well-being, and therefore the social cost of carbon (SCC), requires understanding not just the biophysical effects of climate change but also the particular role they play in supporting human welfare. This article reviews a range of topics from natural capital accounting through climate change economics important for quantifying the ecological costs of climate change and integrating these costs into SCC calculations. Expected final online publication date for the Annual Review of Resource Economics, Volume 14 is October 2022. Please see http://www.annualreviews.org/page/journal/pubdates for revised estimates. 
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  2. Consumption in industrialized regions contributes to land-use change and greenhouse gas emissions in low-income regions. 
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  3. null (Ed.)
  4. Abstract

    Combining new constraints on future socio‐economic trajectories and the climate system's response to emissions can substantially reduce the projection uncertainty currently clouding regional climate adaptation decisions—more than either constraint individually.

     
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  5. Abstract

    Climate change is expected to increase the scarcity and variability of fresh water supplies in some regions with important implications for irrigated agriculture. By allowing for increased flexibility in response to scarcity and by incentivizing the allocation of water to higher value use, markets can play an important role in limiting the economic losses associated with droughts. Using data on water demand, the seniority of water rights, county agricultural reports, high-resolution data on cropping patterns, and agronomic estimates of crop water requirements, we estimate the benefits of market-based allocations of surface water for California’s Central Valley. Specifically, we estimate the value of irrigation water and compare the agricultural costs of water shortages under the existing legal framework and under an alternate system that allows for trading of water. We find that a more efficient allocation of curtailments could reduce the costs of water shortages by as much as $362 million dollars per year or 4.4% of the net agricultural revenue in California in expectation, implying that institutional and market reform may offer important opportunities for adaptation.

     
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  6. Abstract

    The direct impacts of climate change on crop yields and human health are individually well-studied, but the interaction between the two have received little attention. Here we analyze the consequences of global warming for agricultural workers and the crops they cultivate using a global economic model (GTAP) with explicit treatment of the physiological impacts of heat stress on humans’ ability to work. Based on two metrics of heat stress and two labor functions, combined with a meta-analysis of crop yields, we provide an analysis of climate, impacts both on agricultural labor force, as well as on staple crop yields, thereby accounting for the interacting effect of climate change on both land and labor. Here we analyze the two sets of impacts on staple crops, while also expanding the labor impacts to highlight the potential importance on non-staple crops. We find, worldwide, labor and yield impacts within staple grains are equally important at +3C warming, relative to the 1986–2005 baseline. Furthermore, the widely overlooked labor impacts are dominant in two of the most vulnerable regions: sub-Saharan Africa and Southeast Asia. In those regions, heat stress with 3C global warming could reduce labor capacity in agriculture by 30%–50%, increasing food prices and requiring much higher levels of employment in the farm sector. The global welfare loss at this level of warming could reach $136 billion, with crop prices rising by 5%, relative to baseline.

     
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