I agree with this. I would have assumed they would do (i), and other responses from people who actually read the paper make me think it might effectively be (iii). I don’t think it’s (ii).
I mentioned it in my comment elsewhere, but—from a quick look at the paper and the supplementary material—I don’t think it’s much like any of these. They don’t make any special mention that I could find of trying to translate purely economic measures into welfare. The only mention I could find about income adjustment is “rich/poor specifications” which appears to be about splitting the formula for growth of damages into one of two forms depending on whether the country is rich or poor.
Edit: They do mention “elasticity of marginal utility” in the discounting module section which is also known as “intergenerational inequality aversion”.
My nonconfident best guess at an interpretation is that, according to these estimates, for every tonne of carbon:
Future Indians suffer damages utility-equivalent to the present population of India paying a total of $76
Future Americans suffer damages utility-equivalent to the present population of the USA paying a total of $48
Future Saudis suffer damages utility-equivalent to the present population of Saudi Arabia paying a total of $47
Next are China, Brazil, and the UAE, all with $24, and then a lot of other countries, and the sum of all these numbers is $417. So it’s as if the $417 is paid by this particular mix of the world’s people, making it iii), something in between. These numbers are totals that don’t divide by population, so an individual inhabitant of Saudi Arabia or the UAE pays a greater absolute amount than an individual American, who pays a greater absolute amount (but a smaller percentage of income) than an individual Indian.
Am I right that what we need to know is whether, when assessing the total global social cost of carbon:
i) they multiplied harms to the world’s poorest people, measured in equivalent dollars of their income, by ~100x;
ii) they divided the harms to the world richest people, measured in equivalent dollars of their income, by ~100x;
iii) or something in between?
HH’s argument only goes through if it’s the second of the three.
I agree with this. I would have assumed they would do (i), and other responses from people who actually read the paper make me think it might effectively be (iii). I don’t think it’s (ii).
I mentioned it in my comment elsewhere, but—from a quick look at the paper and the supplementary material—I don’t think it’s much like any of these. They don’t make any special mention that I could find of trying to translate purely economic measures into welfare. The only mention I could find about income adjustment is “rich/poor specifications” which appears to be about splitting the formula for growth of damages into one of two forms depending on whether the country is rich or poor.
Edit: They do mention “elasticity of marginal utility” in the discounting module section which is also known as “intergenerational inequality aversion”.
My nonconfident best guess at an interpretation is that, according to these estimates, for every tonne of carbon:
Future Indians suffer damages utility-equivalent to the present population of India paying a total of $76
Future Americans suffer damages utility-equivalent to the present population of the USA paying a total of $48
Future Saudis suffer damages utility-equivalent to the present population of Saudi Arabia paying a total of $47
Next are China, Brazil, and the UAE, all with $24, and then a lot of other countries, and the sum of all these numbers is $417. So it’s as if the $417 is paid by this particular mix of the world’s people, making it iii), something in between. These numbers are totals that don’t divide by population, so an individual inhabitant of Saudi Arabia or the UAE pays a greater absolute amount than an individual American, who pays a greater absolute amount (but a smaller percentage of income) than an individual Indian.