Executive Summary 3

The Economics of Climate Change 6

Integration of Climate Models and Financial Valuation 8

Assessing the Aggregate Country Impact 9

The Economic Impact of Climate Change 11

Another Dose of Creative Destruction 13

The Role of Technology 15

International Trade Aspects 17

Financial Services Sector and Financial Markets 19

The Scientific Basis 21

Impact of Climate-Related Damages 27

The Role of Greenhouse Gas Emissions 30

Outlook for Greenhouse Gas Emissions 32

Carbon Capture and Storage 35

A Macro View on Greenhouse Gas Emissions 36

Scope for Reducing Greenhouse Gas Emissions 39

Policies to Contain Greenhouse Gas Emissions 41

A Simple Model of Environmental Policy Instruments 43

ETS: European Union Emission Trading Scheme 44

The Role of Greenhouse Gases by Sector 46

The Kyoto Protocol 52

Appendix: The Greenhouse Effect 53