Economics, institutions and adaptation to climate change

Christoph Oberlack and Bernhard Neumärker

No 04-2011, The Constitutional Economics Network Working Papers from University of Freiburg, Department of Economic Policy and Constitutional Economic Theory

Abstract: Adaptation to the consequences of climate change has attracted increasing interest as a necessary complement to greenhouse gas mitigation. Economic approaches to climate adaptation are rarely articulated and discussed explicitly despite many benefits of such a framework-level discourse. Therefore, this article investigates how climate adaptation is framed and approached in economics and attempts to contribute to the development of economic frameworks of climate adaptation. First, the paper identifies and critically reviews four major strands of current adaptation economics: estimation of adaptation benefits and costs, strategies for adaptation, the role of markets and governments, and policy instruments for adaptation. While having their merits, serious methodical difficulties prevail. Moreover, the applied neoclassical framing seems too narrow to capture the plethora of governance challenges and normative criteria revealed in adaptation policy discourses and in the multidisciplinary adaptation literature. The second part of this article outlines an institutional economics approach to climate adaptation that addresses caveats in the current state-of-the-art and offers additional concepts to study climate adaptation. Moreover, promising methods and strategies for adaptation research are presented and future research directions suggested. Finally, the paper assesses the normative foundations of climate adaptation economics and their implications for positive adaptation research.

Keywords: Economics of Climate Change Adaptation; Institutional Economics; Governance of Climate Adaptation; Adaptive Capacity; Barriers; Normative Economics (search for similar items in EconPapers)
JEL-codes: B52 D02 D63 D78 Q54 (search for similar items in EconPapers)
Date: 2011
New Economics Papers: this item is included in nep-ene, nep-env and nep-pke
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:cenwps:042011

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