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Climate Modeling for Macroeconomic Policy: A Case Study for Pakistan

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dc.contributor.authorBurns, Andrew
dc.contributor.authorJooste, Charl
dc.contributor.authorSchwerhoff, Gregor
dc.date.accessioned2021-09-27T21:18:06Z
dc.date.available2021-09-27T21:18:06Z
dc.date.issued2021-09
dc.description.abstractAs the effects of climate change become increasingly evident, the design and implementation of climate-aware policies have assumed a more central role in the macroeconomic policy debate. With this has come an increasing recognition of the importance of introducing climate into the economic policy making tools used by central economic policy making agencies (such as ministries of finance and ministries of planning). This paper integrates climate outcomes into a macro-structural model for Pakistan, the kind of model that is suitable for use on a regular basis by ministry staff. The model includes the standard set of variables and economic logic that are necessary for the kinds of forecasting, economic policy, and budgetary planning analysis typically conducted by central ministries. In addition to standard outputs (unemployment, inflation, gross domestic product growth, and fiscal and current accounts), the model generates climate outcomes (tons of carbon emitted and economic and health damages due to higher temperatures and pollution). These outcomes are generated when specific climate policies such as mitigation are analyzed, but also when other policies are analyzed that might have unanticipated climate impacts. The paper describes the changes made to the World Bank’s standard macro structural model, MFMod, in integrated climate outcomes, climate policies, and the economic impacts of climate on Pakistan’s economy. Notably, carbon-tax scenarios show that a $20 carbon tax can reduce emissions in Pakistan by 36 percent by 2050. Gross domestic product impacts could also be positive, if the revenues from the carbon tax were used to reduce reliance on heavily distorting taxes. The model also quantifies associated co-benefits from reduced local air pollution and better health and productivity outcomes. In the absence of action to restrain climate change, the model suggests that increased temperatures and rain variability could reduce output by as much as 10 percent compared with a scenario where global temperature rises were minimized.en
dc.identifierhttp://documents.worldbank.org/curated/undefined/747101632403308927/Climate-Modeling-for-Macroeconomic-Policy-A-Case-Study-for-Pakistan
dc.identifier.doi10.1596/1813-9450-9780
dc.identifier.urihttps://hdl.handle.net/10986/36307
dc.languageEnglish
dc.publisherWorld Bank, Washington, DC
dc.relation.ispartofseriesPolicy Research Working Paper;No. 9780
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo
dc.subjectCLIMATE CHANGE
dc.subjectCARBON PRICING
dc.subjectECONOMIC MODELING
dc.titleClimate Modeling for Macroeconomic Policyen
dc.title.subtitleA Case Study for Pakistanen
dc.typeWorking Paperen
dc.typeDocument de travailfr
dc.typeDocumento de trabajoes
dspace.entity.typePublication
okr.crossref.titleClimate Modeling for Macroeconomic Policy: A Case Study for Pakistan
okr.date.disclosure2021-09-23
okr.date.doiregistration2025-04-10T09:53:26.235251Z
okr.date.lastmodified2021-09-23T00:00:00Zen
okr.doctypePublications & Research
okr.doctypePublications & Research::Policy Research Working Paper
okr.docurlhttp://documents.worldbank.org/curated/undefined/747101632403308927/Climate-Modeling-for-Macroeconomic-Policy-A-Case-Study-for-Pakistan
okr.guid747101632403308927
okr.identifier.doi10.1596/1813-9450-9780
okr.identifier.externaldocumentum090224b0889d8fb4_1_0
okr.identifier.internaldocumentum33437191
okr.identifier.reportWPS9780
okr.importedtrueen
okr.language.supporteden
okr.pdfurlhttp://documents.worldbank.org/curated/en/747101632403308927/pdf/Climate-Modeling-for-Macroeconomic-Policy-A-Case-Study-for-Pakistan.pdfen
okr.region.administrativeSouth Asia
okr.region.countryPakistan
okr.topicEnvironment::Adaptation to Climate Change
okr.topicEnvironment::Carbon Policy and Trading
okr.topicEnvironment::Climate Change Mitigation and Green House Gases
okr.topicEnvironment::Climate Change and Environment
okr.topicEnvironment::Environmental Economics & Policies
okr.topicMacroeconomics and Economic Growth::Taxation & Subsidies
okr.unitMacroeconomics, Trade and Investment Global Practice
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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