THE MARGINAL COST OF CO2 EMISSIONS

Haraden's model for estimating the economic cost of global warming is analysed. We change his method of discounting and some of his input pa rameters in a manner consistent with physical and economic theory as w ell as empirical data. We then find much higher costs than Haraden fou nd. These costs are compared to the cost of reducing CO2 emissions and we find that deep cuts of the emissions of CO2 are preferable. A chec k of the sensitivity of our results with respect to some crucial param eter values does not alter that conclusion.