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Buying Greenhouse Gas Insurance: International Trade and the Adaptation to Climate Change and Variability

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  • Schenker, Oliver
  • Stephan, Gunter

Abstract

This paper has three messages mainly, which are observed both in a simple theoretical model and its empirical application in a general equilibrium analysis of climate change, international trade and adaptation. First, trade might be viewed as a kind of autonomous adaptation to climate change and variability. In particular, trade can help to reduce direct impacts of global climate change on a region’s welfare, but is itself vulnerable to climate change and variability. Second, the less affected and the richer nations are, the more they can profit mostly from moderating the impacts of global climate change through trade. Finally and third, even without cooperation in the solution of the global climate problem, it is in the self-interest of the industrialized nations to fund strategically adaptation in the developing part of the world.

Suggested Citation

  • Schenker, Oliver & Stephan, Gunter, 2011. "Buying Greenhouse Gas Insurance: International Trade and the Adaptation to Climate Change and Variability," Papers 219, World Trade Institute.
  • Handle: RePEc:wti:papers:219
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    References listed on IDEAS

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    1. Nordhaus, William D, 1991. "To Slow or Not to Slow: The Economics of the Greenhouse Effect," Economic Journal, Royal Economic Society, vol. 101(407), pages 920-937, July.
    2. Fankhauser, Samuel & Smith, Joel B. & Tol, Richard S. J., 1999. "Weathering climate change: some simple rules to guide adaptation decisions," Ecological Economics, Elsevier, vol. 30(1), pages 67-78, July.
    3. Collins, Julie, 2007. "Climate Change and Emissions Trading (Power Point)," 2007 Seminar, August 24, 2007, Wellington, New Zealand 97617, New Zealand Agricultural and Resource Economics Society.
    4. Scott Barrett, 2008. "Climate treaties and the imperative of enforcement," Oxford Review of Economic Policy, Oxford University Press, vol. 24(2), pages 239-258, Summer.
    5. William R. Cline, 2007. "Global Warming and Agriculture: Impact Estimates by Country," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 4037, January.
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    Cited by:

    1. Hirte, Georg & Nitzsche, Eric & Tscharaktschiew, Stefan, 2018. "Optimal adaptation in cities," Land Use Policy, Elsevier, vol. 73(C), pages 147-169.

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