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Economic Impacts of a Low Carbon Economy on Global Agriculture: The Bumpy Road to Paris

Joint Research Centre, European Commission, 41092 Seville, Spain
Research and Analysis Directorate, Agriculture and Agri-Food Canada, Ottawa, ON K1A 0C5, Canada
Aragonese Agency for Research and Development (ARAID), Centre for Agro-Food Research and Technology, Instituto Agroalimentario de Aragón (IA2), Government of Aragón, 50059 Zaragoza, Spain
Authors to whom correspondence should be addressed.
Disclaimer: The views expressed are purely those of the authors and may not in any circumstances be regarded as stating an official position of the European Commission and Agri-Food Canada. The results of the analysis based on the use of the Aglink-Cosimo model are outside the responsibility of the OECD and FAO Secretariats.
Sustainability 2019, 11(8), 2349;
Received: 7 March 2019 / Revised: 5 April 2019 / Accepted: 16 April 2019 / Published: 19 April 2019
(This article belongs to the Special Issue Global Warming, Environmental Governance and Sustainability Issues)
PDF [3226 KB, uploaded 19 April 2019]


Limiting climate change below a 2 °C temperature increase this century will require substantial reductions of greenhouse gas emissions and the transition to a climate-friendly, low carbon society. In this paper, the economic impact of a less carbon-intensive economy on agricultural markets is estimated by means of an integrated modelling framework. First, the macroeconomic impacts of moving into a global low carbon economy are analysed by applying different carbon taxes in a general equilibrium modelling framework. Second, the potential adoption of emission mitigation technologies is quantified and used in the Aglink-Cosimo model to assess the impacts on agricultural markets of emission mitigation scenarios compatible with the 2.0 °C target prescribed in the Paris Agreement. Results for 2030 show reductions in global non-CO2 GHG emissions from agriculture (i.e., methane and nitrous oxide) by 10, 16 and 19% in 50, 100 and 150 USD/t CO2eq global carbon tax scenarios, respectively (Least Developed Countries excluded). Only between 0.6% and 1.3% of the global reduction is caused by indirect macroeconomic effects, although at the regional level they can cause up to 5.8% of the reduction in agricultural emissions. Results suggest that ambitious mitigation targets can provoke significant negative impacts on agricultural production and underline the importance of integrating GHG emission developments and impacts of related policies into agricultural market projections. View Full-Text
Keywords: Paris Agreement; climate change mitigation; agricultural sector; market outlook; Aglink-Cosimo Paris Agreement; climate change mitigation; agricultural sector; market outlook; Aglink-Cosimo

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Jensen, H.; Pérez Domínguez, I.; Fellmann, T.; Lirette, P.; Hristov, J.; Philippidis, G. Economic Impacts of a Low Carbon Economy on Global Agriculture: The Bumpy Road to Paris. Sustainability 2019, 11, 2349.

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