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Evaluating the economic cost of coastal flooding

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

Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra

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: quantitative economic geography; economic growth and development; climate change (search for similar items in EconPapers)
JEL-codes: Q54 R11 R12 R13 (search for similar items in EconPapers)
Date: 2019-09
New Economics Papers: this item is included in nep-env, nep-gen and nep-geo
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Related works:
Working Paper: Evaluating the Economic Cost of Coastal Flooding (2019) Downloads
Working Paper: Evaluating the Economic Cost of Coastal Flooding (2018) Downloads
Working Paper: Evaluating the Economic Cost of Coastal Flooding (2018) Downloads
Working Paper: Evaluating the Economic Cost of Coastal Flooding (2017) Downloads
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