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Potsdam Revises Climate-Economy Forecast: Global Income Loss Now Estimated at 17% by 2050

The Potsdam Institute has revised a 2024 Nature paper after identifying data errors and underestimating statistical uncertainty. The projected global income decline by 2050 was adjusted from 19% to 17%, and the probability that repair costs will exceed resilience-building fell from 99% to 91%. Nature retracted the original paper while the corrected analysis, not yet peer-reviewed, was issued; authors and outside experts say the central conclusion—that uncontrolled warming will severely harm poorer economies—remains unchanged.

03:49 AM, 12/04/2025Economy
Potsdam Revises Climate-Economy Forecast: Global Income Loss Now Estimated at 17% by 2050

Potsdam Institute revises down a high-profile estimate of climate-driven global income loss after identifying data errors and underestimated statistical uncertainty.

Scientists at the Potsdam Institute for Climate Impact Research originally published a 2024 paper in Nature projecting a 19% drop in global income by 2050 if greenhouse-gas emissions remain unchecked. After discovering inaccuracies in underlying economic data—most notably figures for Uzbekistan from 1995–1999—and applying a more rigorous treatment of uncertainty, the team has revised the estimate to 17%.

The authors also adjusted their earlier probability that, by midcentury, repair costs would exceed the costs of building resilience. That likelihood was lowered from 99% to 91%. Nature has posted a retraction of the original paper while the corrected analysis, which the authors say is not yet peer-reviewed, is being circulated.

Why the change matters

The researchers say the Uzbekistan data error had an outsized influence on global results. Correcting that input and accounting for broader statistical uncertainty produced the modest downward revisions, but did not alter the study’s main message: unchecked climate change will impose severe economic damage worldwide and will hit poorest regions the hardest—despite those regions contributing the least to global emissions.

“The core finding remains: climate change will be enormously damaging to the world economy if unchecked, and the impact will hit hardest in the lowest-income areas,” said Max Kotz, a co-author of the study.

“The thrust of the Potsdam team’s work remains the same, no matter which part of the range the true figure will be,” said Gernot Wagner, a climate economist at Columbia Business School.

This episode underscores the importance of high-quality economic data and transparent uncertainty quantification in climate-economy modeling. Policymakers should view the revised figures as part of a robust body of evidence that points to substantial and rising economic risks from continued warming, reinforcing the case for both emissions mitigation and targeted resilience investments.

Reporting: Alexa St. John.

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