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Climate adaptation: Risk, uncertainty and decision-making

At its core, the report presents an eight-stage decision- making framework. Given the broad audience and diversity of applications, the framework and supporting guidance are inevitably rather generic. There are questions for the decision-maker to apply at each stage, and tools that may help.

Incorporating catastrophes into integrated assessment: science, impacts, and adaptation

Incorporating potential catastrophic consequences into integrated assessment models of climate change has been a top priority of policymakers and modelers alike. We review the current state of scientific understanding regarding three frequently mentioned geophysical catastrophes, with a view toward their implications for integrated assessment modeling.

Uncertainty characterization in risk analysis for decision-making practice

This document provides an overview of sources of uncertainty in probabilistic risk analysis. For each phase of the risk analysis process (system modeling, hazard identification, estimation of the probability and consequences of accident sequences, risk evaluation), the authors describe and classify the types of uncertainty that can arise.

The economics of climate change in the Pacific

The Asian Development Bank (ADB) conducted this study of the economics of climate change in the Pacific to assist its Pacific developing member countries (DMCs) in adapting to climate risks. After an extensive review of past and ongoing research efforts on climate change, the study focused on identifying and quantifying its economic impacts on the Pacific DMCs.

Assessing the costs of climate change and adaptation in South Asia.

This book discusses the economic costs and benefits of unilateral and regional actions on climate change adaptation in ADB’s six South Asia DMCs, namely Bangladesh, Bhutan, India, the Maldives, Nepal, and Sri Lanka. It provides an estimate of the total economic loss throughout the 21st century to the South Asia DMCs.

Estimating the value of economic benefits associated with adaptation to climate change in a developing country: A case study of improvements in tropical cyclone warning services

Linking tropical cyclone activity with anthropogenic climate change is subject to on-going debate. However, modelling studies consistently have projected that climate change is likely to increase the intensity of cyclones and the related rainfall rates in the future.

Adaptive Flood Risk Management Under Climate Change Uncertainty Using Real Options and Optimization

It is well recognized that adaptive and flexible flood risk strategies are required to account for future uncertainties. Development of such strategies is, however, a challenge. Climate change alone is a significant complication, but, in addition, complexities exist trying to identify the most appropriate set of mitigation measures, or interventions.

Nonuse values of climate policy : an empirical study in Xinjiang and Beijing

In this study we test empirically the hypothesis that also in a growth-oriented economy like China non-materialistic values like the nonuse values of climate policy are perceived and respected by the population. This should especially hold for the better educated people living in big cities like Beijing.

Adaptation measures in the EU : policies, costs, and economic assessment : climate proofing of key EU policies

The aim of this report was to identify the most appropriate measures on the EU level to address different threats. A final selection of measures to be assessed with a view to their costs and economic, social and environmental impacts was agreed at the first interim meeting with the Commission. Measures already part of EU wide assessment projects were no part of the assessment.

Discounting for climate change

It is well-known that the discount rate is crucially important for estimating the social cost of carbon, a standard indicator for the seriousness of climate change and desirable level of climate policy. The Ramsey equation for the discount rate has three components: the pure rate of time preference, a measure of relative risk aversion, and the rate of growth of per capita consumption.

Risk Aversion, time preference, and the social cost of carbon

The Stern Review reported a social cost of carbon of over $300/tC, calling for ambitious climate policy. We here conduct a systematic sensitivity analysis of this result on two crucial parameters: the rate of pure time preference, and the rate of risk aversion. We show that the social cost of carbon lies anywhere in between 0 and $120,000/tC.

Siblings, not triplets: social preferences for risk, inequality and time in discounting climate change.

Arguments about the appropriate discount rate often start by assuming a Utilitarian social welfare function with isoelastic utility, in which the consumption discount rate is a function of the (constant) elasticity of marginal utility along with the (much discussed) utility discount rate.

Scenarios and Sustainability - A Swedish Case Study of Adaptation Tools for Local Decision-Makers

Adaptation to climate change often involves long time frames and uncertainties over consequences of chosen adaptation measures. In this study, two tools developed for assisting local decision-makers in adaptation planning were tested: socio-economic scenarios and sustainability analysis.

Does phosphate treatment for prevention of eutrophication pass the benefit-cost test?

Over the past few decades the problem of eutrophication of water bodies has accelerated due to large additions of nutrients from human sources. This paper conducts a contingent valuation of household willingness to pay to reduce eutrophication impacts. The application employs the recently proposed one-and-one-half-bound dichotomous choice method for eliciting willingness to pay responses.

Does Ambiguity Aversion Raise the Optimal Level of Effort? A Two-Period Model

The objective of this paper is to analyze the effect the uncertainty about the probabilities has in the decision making process. In particular, I give an answer to the following question: Does the ambiguous nature of an outcome lead an ambiguity averse decision maker to exert more effort than another who does not take this ambiguity into account?

Climate change and adaptation : the case of Nigerian agriculture

The present research offers an economic assessment of climate change impacts on the four major crop families characterizing Nigerian agriculture, covering more than 80% of agricultural value added. The evaluation is performed shocking land productivity in a computable general equilibrium model tailored to replicate Nigerian economic development until the mid of this century.

Adapting and Mitigating to Climate Change: Balancing the Choice under Uncertainty

Nowadays, as stressed by important strategic documents like for instance the 2009 EU White Paper on Adaptation or the recent 2009 “Copenhagen Accord”, it is amply recognized that both mitigation and adaptation strategies are necessary to combat climate change.

AD-DICE: an implementation of adaptation in the DICE model

Integrated Assessment Models (IAMS) have helped us over the past decade to understand the interactions between the environment and the economy in the context of climate change.

Climate change and extreme events : an assessment of economic implications.

We use a general equilibrium model of the world economy, and a regional economic growth model, to assess the economic implications of vulnerability from extreme meteorological events, induced by the climate change. In particular, we first consider the impact of climate change on ENSO and NAO oceanic oscillations and, subsequently, the implied variation on regional expected damages.

Economy-wide impacts of climate change on agriculture in Sub-Saharan Africa.

Two possible adaptation options to climate change for Sub-Saharan Africa are analyzed under the SRES B2 scenario. The first scenario doubles irrigated areas in Sub-Saharan Africa by 2050, compared to the baseline, but keeps total crop area constant. The second scenario increases both rainfed and irrigated crop yields by 25 percent for all Sub-Saharan African countries.

A participatory approach for assessing alternative climate change adaptation responses to cope with flooding risk in the upper Brahmaputra and Danube river basins

This work illustrates the preliminary findings of a participatory research process aimed at identifying responses for sustainable water management in a climate change perspective, in two river basins in Europe and Asia. The paper describes the methodology implemented through local workshops, aimed at eliciting and evaluating possible responses to flooding risk.

A Hurricane’s Long-Term Economic Impact: the Case of Hawaii’s Iniki

The importance of understanding the macro-economic impact of natural disasters cannot be overstated. Hurricane Iniki, that hit the Hawaiian island of Kauai on September 11th, 1992, offers an ideal case study to better understand the long-term economic impacts of a major disaster.

ADAPTING MORE CLEVERLY TO CLIMATE CHANGE BY USING “REAL OPTIONS” TO ADDRESS THE UNCERTAINTIES.

Scientists consider that some climate change is already inevitable, even if anthropogenic greenhouse emissions are stabilised immediately. Adaptation measures are therefore needed, irrespective of any mitigation action. But policy discussion is focussed on deterministic responses, generally risk-based „worst case‟ scenarios.

Economic Evaluation of Climate Change Impacts and Adaptation in Italy

The paper deals with the social and economic dimensions of climate change impacts and adaptation in Italy. The ultimate aim of the paper is to provide policy makers and experts with a conceptual framework, as well as methodological and operational tools for dealing with climate change impacts and adaptation from an economic perspective.

A Cost-Benefit Analysis of the New Orleans Flood Protection System

In the early stages of rebuilding New Orleans, a decision has to be made on the level of flood protection the city should implement. Such decisions are usually based on cost-benefit analyses. But in such an analysis, the results are contingent on a number of underlying assumptions and varying these assumptions can lead to different recommendations.

Flood Risks, Climate Change Impacts and Adaptation Benefits in Mumbai: An Initial Assessment of Socio-Economic Consequences of Present and Climate Change Induced Flood Risks and of Possible Adaptation Options

Managing risks from extreme events will be a crucial component of climate change adaptation. In this study, we demonstrate an approach to assess future risks and quantify the benefits of adaptation options at a city-scale, with application to flood risk in Mumbai.

A Framework for Benefit-Cost Analysis of Adaptation to Climate Change and Climate Variability

The potential damages of climate change and climate variability are dependent upon the responses or adaptations that people make to their changing environment. By adapting the management of resources, the mix and methods of producing goods and services, choices of leisure activities, and other behavior, people can lessen the damages that would otherwise result.

Balancing expenditures on mitigation of and adaptation to climate change : an exploration of issues relevant to developing countries

Although climate policies have been so far mostly focused on mitigation, adaptation to climate change is a growing concern in developed and developing countries. This paper discusses how adaptation fits into the global climate strategy, at the global and national levels.

How might climate change affect economic growth in developing countries? : a review of the growth literature with a climate lens

This paper reviews the empirical and theoretical literature on economic growth to examine how the four components of the climate change bill, namely mitigation, proactive (ex ante) adaptation, reactive (ex post) adaptation, and ultimate damages of climate change affect growth, especially in developing countries.

Wetland valuation : state of the art and opportunities for further development.

Valuing the environment remains a problematic and controversial process. Objections vary from concerns about the legitimacy of the procedure to the technical difficulty of the process itself. The purpose of this workshop was to explore these concerns in the context of managed realignment. The purpose of the workshop was real moreover and not dryly academic.

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