Evaluating the Economic Cost of Coastal Flooding

Klaus Desmet, Robert Kopp (), Scott A. Kulp, David Nagy (), Michael Oppenheimer, Esteban Rossi-Hansberg and Benjamin H. Strauss

No 13128, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: 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, permanent flooding is projected to reduce global real GDP by an average of 0.19% in present value terms, with welfare declining by 0.24% as people move to places with less attractive amenities. By the year 2200 a projected 1.46% of world population will be displaced. Losses in many coastal localities are more than an order of magnitude larger, with some low-lying urban areas particularly hard hit. When ignoring the dynamic economic adaptation of investment and migration to flooding, the loss in real GDP in 2200 increases from 0.11% to 4.5%. This shows the importance of including dynamic adaptation in future loss models.

Keywords: Space; Geography; Sea-level rise; Coastal flooding; Spatial growth models; Mobility; Trade (search for similar items in EconPapers)
JEL-codes: F18 F22 F43 Q51 Q54 Q56 R11 (search for similar items in EconPapers)
Date: 2018-08
New Economics Papers: this item is included in nep-env
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Citations: View citations in EconPapers (18)

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Related works:
Journal Article: Evaluating the Economic Cost of Coastal Flooding (2021)
Working Paper: Evaluating the Economic Cost of Coastal Flooding (2020)
Working Paper: Evaluating the economic cost of coastal flooding (2019)
Working Paper: Evaluating the Economic Cost of Coastal Flooding (2018)
Working Paper: Evaluating the Economic Cost of Coastal Flooding (2017)
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