Evaluating the Economic Cost of Coastal Flooding

Sea-level rise and ensuing permanent coastal inundation will cause spatial shifts in population and economic activity over the next 200 years. Using a highly spatially disaggregated, dynamic model of the world economy that accounts for the dynamics of migration, trade, and innovation, this paper estimates the consequences of probabilistic projections of local sea‐level changes under different emissions scenarios. Under an intermediate greenhouse gas concentration trajectory (Representative Concentration Pathway [RCP] 4.5), permanent flooding is projected to reduce global real GDP by an average of 0.22% in present value terms, with welfare declining by as much as 0.76% as people move to places with less attractive amenities. By the year 2200 a projected 0.79% of world population will be displaced (with a 95% credible interval 0.20%‐1.51%). Losses in many coastal localities are more than an order of magnitude larger, e.g., 10% of 10 x 10 coastal cells lose more than 8% of real GDP in present discounted value terms.