What’s the cost?

John Quiggen, in the comments to a post on An Inconvenient Truth (among other topics), answers an important question:

"As an economist if the price of all energy sources in the world were doubled what would be the effect on the world economy?"

Very modest, as I’ve discussed in previous posts, and as estimates like those of ABARE (except for the bogus ring-in scenario D) indicate. Likely order of magnitude is a 3 per cent reduction in GDP relative to trend to 2050, that is, a loss of about one year’s growth over that period.