Overheated: How Flawed Analyses Overestimate the Costs of Climate Change

Prominent recent studies that forecast the cost of human-caused climate change rely on statistical analyses of the effects of temperature variation. These correlation-based, temperature-impact studies start with present-day relationships between temperatures and outcomes such as mortality or economic growth. They extrapolate from those relationships a proportionally larger response to long-term projected climate warming and assign dollar values to the very large impacts that appear to emerge.

This paper examines a set of such studies that the U.S. Environmental Protection Agency and the U.S. Government Accountability Office have used to estimate the costs of human-caused climate change for the U.S. by the end of the 21st century. The costs include deaths from extreme heat, lost hours of work from extreme heat, and deaths from heat-caused air pollution. The paper also examines another study, published in Nature, that projects the effect of human-caused climate change on global economic production.

1. Temperature studies do not offer useful projections of deaths and lost hours of work for extreme heat, or deaths due to heat-caused air pollution, in the U.S. The projection of lower global economic output due to projected human-caused climate change is also flawed.
2. The crucial (though not the only) flaw of temperature studies is that they neglect human adaptations to a changing climate. Such adaptations have already been made by industrial societies expanding into warm regions, such as the American South and Southwest. The temporary effects of temperature variations—such as an unusual hot spell—cannot be eq uated with a long-term change in temperature patterns. For example, the failure of people to install air conditioners in a year with one extra 90°F day does not mean that they won’t do so in the face of 40 extra 90°F days.
3. Properly understood, temperature studies do not offer useful predictions of the future costs of projected human-caused climate change.

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Oren Cass is a senior fellow at the Manhattan Institute. Follow him on Twitter here.