Global Temperatures and Greenhouse Gases: A Common Features Approach

We propose a common features approach for testing for common trends and estimating long-run relationships between variables with complex trends. Using this approach, we establish that global temperatures and greenhouse gases share a common trend and we estimate their long-run relationship without conditioning on the exact nature of their trends. We also find cycles in global temperature series that have periods of 72 years and amplitudes that have been non-negligible compared to the warming effect caused by anthropogenic greenhouse gas emissions. Using this model, we forecast future temperatures conditional on representative concentration pathways (RCPs) of greenhouse gases considered by the Intergovernmental Panel on Climate Change. Our forecasts show that in the moderate RCP scenario the cyclical component could play a significant role in the next 30 years, in a way that would make the politics of effective emission control policymaking more challenging.