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  • This research paper analyzes the FUND model of climate economics, finding that its low Social Cost of Carbon (SCC) estimate of $6 is largely driven by an overestimation of agricultural benefits from CO2 fertilization and temperature increases. The authors identify several technical flaws, including a potential division-by-zero error in the optimum temperature equation and the use of implausible temperature ranges in Monte Carlo simulations. They argue that FUND relies on outdated research from the 1990s and suggest that updating the model with recent empirical data on crop yields and CO2 fertilization would significantly increase the SCC estimate.

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    Themes: social cost of carbonclimate damagesagricultural impactsco2 fertilization
    Stockholm Environment Institute

    Document type: Research paper

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