What actually happened? Novel econometric methods to improve estimates of climate impacts and policies

Thesis

Climate change is one of the most crucial societal challenges of the 21st century, affecting a wide range of social, economic, and environmental aspects of modern society. To design and implement policies that can deal with the climate challenge requires an accurate and robust understanding of the physical impacts of climate change as well as understanding the potential impacts of different policy instruments, their limitations, as well as their successes and failures in the past. Despite this necessity, there remains substantial empirical uncertainty around the effectiveness of policy approaches both in the context of mitigation and adaptation. In this doctoral thesis, I present a total of five papers that advance the field of impact estimation in the context of climate change. By using and developing novel econometric methods, I show how existing gaps in this literature can be addressed. In Paper 1, I develop a novel statistical test to illustrate the impact that outlying observations have on regression coefficients of econometric climate impact estimates. In Paper 2, I use these methods and advance climate impact estimates further by presenting a first set of economic climate damage projections that incorporate the effects of extreme weather events and adaptation. While current climate and weather impact data collection approaches focus on manual bottom-up database records, Paper 3 uses machine learning algorithms to predict the occurrence of weather impact events reliably without manual input or on-the-ground knowledge. In Paper 4, I operationalise an alternative way to empirically evaluate policy, which is used in Paper 5 to identify the effects of 10 distinct road transport mitigation policies in the EU15. Overall, I argue that when econometric methods are specified correctly, are applied to the most pressing research questions, and make use of appropriate data then using these methods can allows us to direct adaptation funding more efficiently, track Loss and Damage events around the world, and allow policy-makers to focus on those policy packages that have the largest chance of making a difference.

Authors: Schwarz, MP

• DOI: 10.5287/ora-qrorbgp44
• Type of award: DPhil
• Level of award: Doctoral
• Awarding institution: University of Oxford
• Language: English
• Keywords: climate change; climate impacts; econometrics; economics
• Subjects: Economics; Climate Science