By Bianca Pasca
The science behind climate change often dominates climate news. But increasingly, the economic impact is coming to the fore: and we have The Stern Review to thank for this.
The review was commissioned by the British government, to report to the Prime Minister, Tony Blair, considering the problem from a medium- to long-term perspective. It used economic models- including integrated assessment models- to estimate the economic impact of climate change and macro-economic models to assess the costs and effects of the transition to low-carbon energy systems for the economy as a whole.
Inaction could cost 20% of GDP each year.
This was highly significant because it changed the perception of climate action from an economic burden to an economic benefit and ultimately an economic necessity
While there was much debate after the publication of the report and there still are diverging opinions (after all, a lot of the consequences are still unknown, unpredictable and hard to assess, especially from an economic point of view), The Stern Review did have an important impact.
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