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Prerequisites and limits for economic modelling of climate change impacts and adaptation


  • Jotzo, Frank


There is demand for qualitative and quantitative economic analysis on the optimum degree of climate change mitigation and adaptation, the optimal timing of such actions, and their optimum distribution between countries and sectors. This paper discusses what is, as well as what is not, possible for economic modelling in this field. Specific reference is made to the paper by Bosello, Carraro and de Cian (2009), as well as Tol (2009). Integrated assessment modelling can provide powerful qualitative insights (for example, about the need for both mitigation and adaptation and the interactions between the two, or the need for both individual and policy-driven adaptation). However, the more detailed quantitative results from such studies are subject are extremely limited. In many cases, they are virtually irrelevant as a policy guide. For these models to be useful representations of reality, economic climate change models need three important features: representation of uncertainty about impacts (in particular, the risk of abrupt climate change); fuller representation of economic impacts from climate change and inclusion of non-market impacts; and finally, modelling of equity dimensions. These features are absent in many models currently used. This leads to a tendency for quantitative results to be biased against mitigation as an option to address climate change and in favour of other adaptation.

Suggested Citation

  • Jotzo, Frank, 2010. "Prerequisites and limits for economic modelling of climate change impacts and adaptation," Research Reports 94951, Australian National University, Environmental Economics Research Hub.
  • Handle: RePEc:ags:eerhrr:94951
    DOI: 10.22004/ag.econ.94951

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    Blog mentions

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    1. EERH Research Reports: June 2010
      by David Stern in Stochastic Trend on 2010-07-03 15:06:00


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    Cited by:

    1. Kwiatkowski, Kyle P. & Chinowsky, Paul S., 2017. "Climate change adaptation as an organizational system in transportation infrastructure organizations: Identifying processes and institutional elements," Transport Policy, Elsevier, vol. 60(C), pages 47-53.
    2. Heuson, Clemens & Gawel, Erik & Gebhardt, Oliver & Hansj├╝rgens, Bernd & Lehmann, Paul & Meyer, Volker & Schwarze, Reimund, 2012. "Fundamental questions on the economics of climate adaptation: Outlines of a new research programme," UFZ Reports 05/2012, Helmholtz Centre for Environmental Research (UFZ).

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    Environmental Economics and Policy; Research Methods/ Statistical Methods; Resource /Energy Economics and Policy;

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