THE WEAKEST LINK HYPOTHESIS FOR ADAPTIVE CAPACITY: AN EMPIRICAL TEST

Richard S.J. Tol () and Gary Yohe

No FNU-97, Working Papers from Research unit Sustainability and Global Change, Hamburg University

Abstract: Yohe and Tol (2001) built an indexing method for vulnerability based on the hypothesis that the adaptive capacity for any system facing a vector of external stresses could be explained by the weakest of eight underlying determinants – the so-called “weakest link” hypothesis. Subsequent work supported the hypothesis by analogy from other contexts, but we now offer perhaps the first attempt to explore its validity through empirical means. We estimate a structural form designed to accommodate the full range of possible interactions across determinants. The perfect complement case of the pure “weakest-link” formulation lies on one extreme, and the perfect substitute case where each determinant can compensate for all others at constant rates is the other limiting case. For vulnerability to natural disasters, infant mortality and drinking water treatment, we find qualified support for a modified weakest link hypothesis: the weakest indicator plays an important role, but is not essential because other factors can compensate (with increasing difficulty). For life expectancy, sanitation and nutrition, we find a relationship that is close to linear – the perfect substitute case where the various determinants of adaptive capacity can compensate for each other. Moreover, we find another source of diversity in the assessment of vulnerability, since the factors from which systems draw to create adaptive capacity are different for different risks.

Keywords: Adaptive capacity; vulnerability; weakest-link hypothesis; substitution (search for similar items in EconPapers)
JEL-codes: Q54 (search for similar items in EconPapers)
Date: 2006-01, Revised 2006-01
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Published, Global Environmental Change, 17, 218-227

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Working Paper: THE WEAKEST LINK HYPOTHESIS FOR ADAPTIVE CAPACITY: AN EMPIRICAL TEST (2006)
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