Assessing Climate Change under Uncertainty: A Monte Carlo Approach

Abstract

Climate change has emerged as one of the most multifaceted manifestations of global change of our time. However, there is less confidence about exactly how the climate will change in the future, and lesser confidence still about the adjustments it will induce to natural and human system. Thus, policy formulation for climate change poses a great challenge because of a problem of decision-making under uncertainty. To facilitate climate policy decision, quantification of the uncertainty in climate outcomes under possible policies is needed. This paper presents an approach to assess climate change under uncertainty using Monte Carlo simulations. Here, I find that in the absence of climate policy, the 95% bound on temperature change in 2100 is 5.79°C. The stringent climate policies with aggressive emissions reductions over time lower significantly the temperature change, compared to no policy case.