TY  - GEN
A1  - Wenz, Leonie
A1  - Levermann, Anders
A1  - Willner, Sven N.
A1  - Otto, Christian
A1  - Kuhla, Kilian
T1  - Post-Brexit no-trade-deal scenario: short-term consumer benefit at the expense of long-term economic development
T2  - Postprints der Universität Potsdam : Mathematisch-Naturwissenschaftliche Reihe
N2  - After the United Kingdom has left the European Union it remains unclear whether the two parties can successfully negotiate and sign a trade agreement within the transition period. Ongoing negotiations, practical obstacles and resulting uncertainties make it highly unlikely that economic actors would be fully prepared to a “no-trade-deal” situation. Here we provide an economic shock simulation of the immediate aftermath of such a post-Brexit no-trade-deal scenario by computing the time evolution of more than 1.8 million interactions between more than 6,600 economic actors in the global trade network. We find an abrupt decline in the number of goods produced in the UK and the EU. This sudden output reduction is caused by drops in demand as customers on the respective other side of the Channel incorporate the new trade restriction into their decision-making. As a response, producers reduce prices in order to stimulate demand elsewhere. In the short term consumers benefit from lower prices but production value decreases with potentially severe socio-economic consequences in the longer term.
T3  - Zweitveröffentlichungen der Universität Potsdam : Mathematisch-Naturwissenschaftliche Reihe - 1208 
KW  - model
KW  - origins
KW  - chains
KW  - impact
KW  - costs
Y1  - 2019
U6  - http://nbn-resolving.de/urn/resolver.pl?urn:nbn:de:kobv:517-opus4-525819
SN  - 1866-8372
IS  - 9
ER  - 
TY  - JOUR
A1  - Wenz, Leonie
A1  - Levermann, Anders
A1  - Willner, Sven N.
A1  - Otto, Christian
A1  - Kuhla, Kilian
T1  - Post-Brexit no-trade-deal scenario: short-term consumer benefit at the expense of long-term economic development
JF  - PLoS ONE
N2  - After the United Kingdom has left the European Union it remains unclear whether the two parties can successfully negotiate and sign a trade agreement within the transition period. Ongoing negotiations, practical obstacles and resulting uncertainties make it highly unlikely that economic actors would be fully prepared to a “no-trade-deal” situation. Here we provide an economic shock simulation of the immediate aftermath of such a post-Brexit no-trade-deal scenario by computing the time evolution of more than 1.8 million interactions between more than 6,600 economic actors in the global trade network. We find an abrupt decline in the number of goods produced in the UK and the EU. This sudden output reduction is caused by drops in demand as customers on the respective other side of the Channel incorporate the new trade restriction into their decision-making. As a response, producers reduce prices in order to stimulate demand elsewhere. In the short term consumers benefit from lower prices but production value decreases with potentially severe socio-economic consequences in the longer term.
KW  - model
KW  - origins
KW  - chains
KW  - impact
KW  - costs
Y1  - 2019
VL  - 15
IS  - 9
PB  - PLOS
CY  - San Francisco
ER  - 
TY  - JOUR
A1  - Glanemann, Nicole
A1  - Willner, Sven N.
A1  - Levermann, Anders
T1  - Paris Climate Agreement passes the cost-benefit test
JF  - Nature Communications
N2  - The Paris Climate Agreement aims to keep temperature rise well below 2 degrees C. This implies mitigation costs as well as avoided climate damages. Here we show that independent of the normative assumptions of inequality aversion and time preferences, the agreement constitutes the economically optimal policy pathway for the century. To this end we consistently incorporate a damage-cost curve reproducing the observed relation between temperature and economic growth into the integrated assessment model DICE. We thus provide an intertemporally optimizing cost-benefit analysis of this century's climate problem. We account for uncertainties regarding the damage curve, climate sensitivity, socioeconomic future, and mitigation costs. The resulting optimal temperature is robust as can be understood from the generic temperature-dependence of the mitigation costs and the level of damages inferred from the observed temperature-growth relationship. Our results show that the politically motivated Paris Climate Agreement also represents the economically favourable pathway, if carried out properly.
Y1  - 2020
U6  - https://doi.org/10.1038/s41467-019-13961-1
SN  - 2041-1723
VL  - 11
IS  - 1
PB  - Nature Publishing Group
CY  - London
ER  -