Comparing mitigation, adaptation and residual damage costs under different socio-economic and climate scenarios

Future socio-economic development plays a crucial role in both climate policy and the impacts of climate change. In this study, we for the first time systematically compare the costs of mitigation, adaptation, and residual damage for different socio-economic and climate scenarios known as the Shared Socio-economic Pathways (SSPs). For this, we combine recent damage estimates with adaptation costs and introduce differences in the effectiveness of adaptation based on the SSP projection. The results can be presented in terms of SSP/RCP matrix, with optimal climate outcomes as a function of SSP. The results can also be used to identify critical factors determining the optimal temperature, including socio-economic development, technology development and limits to mitigation and adaptation. The socio-economic limits to adaptation lead to damage costs that are 15% to 60% higher than if optimal adaptation had been possible. Overall, this study demonstrates that the socio-economic developments assumed in the SSP, including inequality reduction and institutional strength, can be equally important for the optimal outcome as the factors typically studied such as discount rate.