Climate Change Could Cut Global Incomes by 40% by 2100

New research has revealed that current economic models have dramatically underestimated the impacts of climate change on global wealth, with global heating of 4°C potentially making the average person 40% poorer, a fourfold increase compared to previous estimates. Even if warming is limited to 2°C, the study found global GDP per person could drop by 16%, far higher than the 1.4% reduction previously forecast. 

This new study, published in Environmental Research Letters, critiques existing economic models for failing to account for extreme weather events and disruptions in global supply chains. Current economic models are underestimating the damage that climate change will cause because they only look at local weather, not how global weather patterns affect economies. However, events, like floods and droughts, in one country can disrupt supply chains and trade worldwide, causing widespread problems for many countries at once.  

The findings show the need for more accurate climate models that combine weather science and economics to better understand the full risks of climate change, helping governments make better decisions to protect economies and the planet. 

Now is the time for governments, businesses, and communities to prioritize and support collaborative climate and economic research, take decisive action to reduce emissions, enhance climate policies, and unite efforts for a sustainable future.

Feature image: Climate change and increasing poverty. Credit: Hitesh Choudhary, Pexel.  

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