Climate physics predicts that the intensity of natural disasters will increase in the future due to climate change. We present a stochastic model of a growing economy where natural disasters are multiple and random, with damages driven by the economy's polluting activity. We provide a...

Climate economics has been criticized for ignoring uncertainty, catastrophic changes, and tipping points (Stern 2016). The present paper addresses these issues. We consider multiple climate shocks which are recurring, random, uninsurable, and potentially large. The associated damages and the...

We analyze the impact of carbon prices on human capital accumulation, sectoral change, and economic growth. In our framework output is produced with dirty and/or clean technologies using skilled and unskilled labor as inputs. Carbon policy affects technology selection which transmits incentives...

To reconsider the Malthusian predictions of natural limits to economic development, the paper develops a multi-sector growth model with exhaustible resource extraction, investments in physical and knowledge capital, climate change, and endogenous fertility. Economic growth is driven by...

The belief that stringent climate policies are very costly is widespread among political decision-makers and the public. The Trump administration stressed the cost argument as the motivation for the US withdrawal from the Paris Climate Agreement. However, such judgements ignore the economic...

The paper develops the concept of "Economic Pathways" (EPs), which characterize theory-based scenarios for an economy that strives to achieve decarbonization by mid-century. The theoretical framework derives closed-from analytical solutions for consumption, innovation, emissions, and population....