Climate hit could halve GDP
Adrien Bilal’s new economic model — winner of the 2026 Best Young Economist Award — estimates unchecked climate change could shrink global GDP by up to 50% by 2100, far above prior forecasts. The projection adds fuel to calls for more ambitious mitigation and for a climate movement that ties emissions policy to job security and inequality. (lemonde.fr) (anarchistfederation.net)
The authors released a revised NBER working paper (No. 32450) in January 2026 that reports a permanent 1°C rise in global mean temperature lowers world GDP “by over 20%” in the long run. (nber.org) (nber.org) An earlier March–May 2024 version of the draft estimated a smaller peak effect — a 1°C rise cutting world GDP by about 12% and implied a present‑value welfare loss near 32% with a Social Cost of Carbon of roughly $772/tCO2. (cowles.yale.edu) (cowles.yale.edu; harvardmagazine.com) Bilal and co‑author Diego R. Känzig base their results on a time‑series “local projection” approach that exploits natural variability in global mean temperature and links it to economic output across 173 countries using weather‑and‑economic records stretching roughly 120 years. (nber.org) (nber.org; news.harvard.edu) In the revised paper the implied Social Cost of Carbon rises into four figures — the NBER abstract reports a SCC in excess of $1,200 per ton — and the authors argue those magnitudes make unilateral decarbonization cost‑effective for large economies such as the United States. (nber.org) (nber.org; siepr.stanford.edu) The study’s methodological pivot — using global rather than country‑level temperature shocks because they correlate more strongly with extreme events — has prompted formal discussion in scholarly fora, including a CEPR/EAERE webinar and a published discussant note by Simon Dietz raising questions about identification and robustness. (siepr.stanford.edu) (siepr.stanford.edu; cepr.org) The prize that highlighted the work, created in 2000 by Le Monde and Le Cercle des économistes, is awarded annually to a French economist under 41 and this year’s jury singled out research that links climate damages to macroeconomic risk and policy debate. (lecercledeseconomistes.fr) (lecercledeseconomistes.fr; lecercledeseconomistes.fr)
