economic changes

The economic analysis of climate change explains how economic thinking, tools and techniques are applied to calculate the magnitude and distribution of damage caused by climate change. It also informs the policies and approaches for mitigation and adaptation to climate change from global to household scales. This topic is also inclusive of alternative economic approaches, including ecological economics and degrowth. In a cost–benefit analysis, the trade offs between climate change impacts, adaptation, and mitigation are made explicit. Cost–benefit analyses of climate change are produced using integrated assessment models (IAMs), which incorporate aspects of the natural, social, and economic sciences. The total economic impacts from climate change are difficult to estimate, but increase for higher temperature changes.Climate change impacts can be measured as an economic cost.: 936–941  This is particularly well-suited to market impacts, that is impacts that are linked to market transactions and directly affect GDP. However, monetary measures of non-market impacts, e.g., impacts on human health and ecosystems, are more difficult to calculate. Economic analysis of climate change is challenging as it is a long-term problem and has substantial distributional issues within and across countries. Furthermore, it engages with uncertainty about the physical damages of climate changes, human responses, and future socioeconomic development.
In most models, benefits exceed costs for stabilization of GHGs leading to warming of 2.5 °C. No models suggest that the optimal policy is to do nothing, i.e., allow "business-as-usual" emissions.

Sub-topics within the economic analysis concept are the economic impacts of climate change, as well as the economics of climate change mitigation. Climate change mitigation consist of human actions to reduce greenhouse gas emissions or to enhance carbon sinks that absorb greenhouse gases from the atmosphere.: 2239 

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