Researchers have also assessed the costs of climate protection by considering both the economic and biophysical systems, and the interactions between them. IAMs do this by combining key elements of biophysical and economic systems into one integrated system. They provide convenient frameworks to combine knowledge from a wide range of disciplines. These models strip down the laws of nature and human behaviour to their essentials to depict how increased GHGs in the atmosphere affect temperature, and how temperature change causes quantifiable economic losses. The models also contain enough detail about the drivers of energy use and energyeconomy interactions to determine the economic costs of different constraints on CO2 emissions (see, e.g., Shogren and Toman, 2000).
IAMs fall into two broad classes: policy optimization and policy evaluation models. Policy optimization models can be divided into three principal types:
Policy evaluation models include:
Current integrated assessment research uses one or more of the following methods (Rotmans and Dowlatabadi, 1998):
A review by Parson and Fisher-Vanden (1997) shows that IAMs have contributed to the establishment of important new insights to the policy debate, in particular regarding the evaluation of policies and responses, structuring knowledge, and prioritizing uncertainties. They have also contributed to the basic knowledge about the climate system as a whole. The review concludes that IAMs face two challenges, namely managing their relationship to research and disciplinary knowledge, and managing their relationship to other assessment processes and to policymaking.
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