Klimathotet och Sveriges ekonomiska tillväxt

This thesis aims to analyse the effects on the Swedish economic growth as a result of growing carbon dioxide emissions during the period of 2017-2060. As being one of the Nordic countries, predicted to be one of the few least affected countries by global warming, Sweden will still most likely face the challenges of rising sea levels and more extreme weather events that will cause damages on infrastructure and buildings. Earlier research is ambiguous suggesting that most countries will experience lower economic growth due to global warming while other research suggest that only poor countries will be affected significantly. By using an augmented version of the Solow model with technology, several simulations have been made to analyse the economic outcomes due to carbon dioxide emissions. Carbon dioxide emissions were assumed to increase depreciation for the parts of physical capital, which was considered more likely to be affected by climate change. Control measures such as environmental subventions, programmes that aim to increase energy efficiency and environmental R&D were also included in the model. The results show that carbon dioxide emissions will lower GDP per capita significantly both with and without environmental control measures. However, all control measures helped lowering carbon dioxide emissions in Sweden. The results therefore suggest that it’s not economically motivated for the Swedish authorities to invest in such control measures. Investments in environmental control measures should however still be made to lower the risk of experiencing negative long-term effects on economic growth after the time studied in this paper