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Private sector investments in climate change adaptation

Author

Listed:
  • Tatiana Filatova

    (Delft University of Technology)

  • Alessandro Taberna

    (Delft University of Technology
    RFF-CMCC European Institute on Economics and the Environment)

  • Theodoros Chatzivasileiadis

    (Delft University of Technology)

  • Ignasi Cortés Arbués

    (Delft University of Technology)

Abstract

Amid escalating climate impacts, understanding private sector adaptation is critical. Here using data of actual adaptation expenditures from nearly 300,000 businesses in five coastal regions, we reveal variations in private sector adaptation across sectors and regions. The agriculture sector leads in adaptation efforts, while transport, construction and utilities—that is potential sources of system-wide cascading effects—lag. Small, medium and large businesses prioritize hard and soft measures, barely investing in ecosystem-based adaptations. Adding to the multifaceted discourse on adaptation effectiveness, our panel data reveal positive, although inelastic in the short run, relationships between private sector adaptations and aggregate regional economic performance. Business adaptations in the construction, transport and health sectors associate positively with regional economic performance, with the accommodation and food services sector yielding the highest return per euro invested in adaptation. Combining these findings with existing assessments of adaptation could support the development of societally effective adaptation strategies.

Suggested Citation

  • Tatiana Filatova & Alessandro Taberna & Theodoros Chatzivasileiadis & Ignasi Cortés Arbués, 2025. "Private sector investments in climate change adaptation," Nature Climate Change, Nature, vol. 15(11), pages 1249-1256, November.
    • Handle: RePEc:nat:natcli:v:15:y:2025:i:11:d:10.1038_s41558-025-02423-w
    DOI: 10.1038/s41558-025-02423-w
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