The impact of climate change on the macroeconomy in the Caribbean

In this study, an attempt is made to assess the economic impact of climate change on nine countries in the Caribbean basin: Aruba, Barbados, Dominican Republic, Guyana, Jamaica, Montserrat, Netherlands Antilles, Saint Lucia and Trinidad and Tobago. A methodological approach proposed by Dell et al...

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Otros Autores:	NU. CEPAL
Formato:	Texto
Lenguaje:	English
Publicado:	ECLAC 2015
Materias:	DESARROLLO SOSTENIBLE CAMBIO CLIMATICO MACROECONOMIA SUSTAINABLE DEVELOPMENT CLIMATE CHANGE MACROECONOMICS
Acceso en línea:	http://hdl.handle.net/11362/38286
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spelling	oai-11362-382862016-08-17T16:02:20Z The impact of climate change on the macroeconomy in the Caribbean NU. CEPAL DESARROLLO SOSTENIBLE CAMBIO CLIMATICO MACROECONOMIA SUSTAINABLE DEVELOPMENT CLIMATE CHANGE MACROECONOMICS In this study, an attempt is made to assess the economic impact of climate change on nine countries in the Caribbean basin: Aruba, Barbados, Dominican Republic, Guyana, Jamaica, Montserrat, Netherlands Antilles, Saint Lucia and Trinidad and Tobago. A methodological approach proposed by Dell et al. (2008) is used in preference to the traditional Integrated Assessment Models. The evolution of climate variables and of the macroeconomy of each of the nine countries over the period 1970 to 2006 is analyzed and preliminary evidence of a relationship between the macroeconomy and climate change is examined. The preliminary investigation uses correlation, Granger causality and simple regression methods. The preliminary evidence suggests that there is some relationship but that the direction of causation between the macroeconomy and the climate variables is indeterminate. The main analysis involves the use of a panel data (random effects) model which fits the historical data (1971-2007) very well. Projections of economic growth from 2008 to 2099 are done on the basis of four climate scenarios: the International Panel on Climate Change A2, B2, a hybrid A2B2 (the mid-point of A2 and B2), and a ‘baseline’ or ‘Business as Usual’ scenario, which assumes that the growth rate in the period 2008-2099 is the same as the average growth rate over the period 1971-2007. The best average growth rate is under the B2 scenario, followed by the hybrid A2B2 and A2 scenarios, in that order. Although negative growth rates eventually dominate, they are largely positive for a long time. The projections all display long-run secular decline in growth rates notwithstanding short-run upward trends, including some very sharp ones, moving eventually from declining positive rates to negative ones. The costs associated with the various scenarios are all quite high, rising to as high as a present value (2007 base year) of US$14 billion in 2099 (constant 1990 prices) for the B2 scenario and US$21 billion for the BAU scenario. These costs were calculated on the basis of very conservative estimates of the cost of environmental degradation. Mitigation and adaptation costs are likely to be quite high though a small fraction of projected total investment costs. .--I. Climate Change and the macroeconomy.--II. Model.--III. Projections to 2099.--IV. Costing climate change.--V. Mitigation and adaptation.--VI. Conclusion 2015-06-15T18:43:40Z 2015-06-15T18:43:40Z 2010-06-07 Texto Documento Completo http://hdl.handle.net/11362/38286 LC/CAR/L.264 en .pdf application/pdf CARIBE CARIBBEAN REGION ECLAC
institution	Cepal
collection	Cepal
language	English
topic	DESARROLLO SOSTENIBLE CAMBIO CLIMATICO MACROECONOMIA SUSTAINABLE DEVELOPMENT CLIMATE CHANGE MACROECONOMICS
spellingShingle	DESARROLLO SOSTENIBLE CAMBIO CLIMATICO MACROECONOMIA SUSTAINABLE DEVELOPMENT CLIMATE CHANGE MACROECONOMICS The impact of climate change on the macroeconomy in the Caribbean
description	In this study, an attempt is made to assess the economic impact of climate change on nine countries in the Caribbean basin: Aruba, Barbados, Dominican Republic, Guyana, Jamaica, Montserrat, Netherlands Antilles, Saint Lucia and Trinidad and Tobago. A methodological approach proposed by Dell et al. (2008) is used in preference to the traditional Integrated Assessment Models. The evolution of climate variables and of the macroeconomy of each of the nine countries over the period 1970 to 2006 is analyzed and preliminary evidence of a relationship between the macroeconomy and climate change is examined. The preliminary investigation uses correlation, Granger causality and simple regression methods. The preliminary evidence suggests that there is some relationship but that the direction of causation between the macroeconomy and the climate variables is indeterminate. The main analysis involves the use of a panel data (random effects) model which fits the historical data (1971-2007) very well. Projections of economic growth from 2008 to 2099 are done on the basis of four climate scenarios: the International Panel on Climate Change A2, B2, a hybrid A2B2 (the mid-point of A2 and B2), and a ‘baseline’ or ‘Business as Usual’ scenario, which assumes that the growth rate in the period 2008-2099 is the same as the average growth rate over the period 1971-2007. The best average growth rate is under the B2 scenario, followed by the hybrid A2B2 and A2 scenarios, in that order. Although negative growth rates eventually dominate, they are largely positive for a long time. The projections all display long-run secular decline in growth rates notwithstanding short-run upward trends, including some very sharp ones, moving eventually from declining positive rates to negative ones. The costs associated with the various scenarios are all quite high, rising to as high as a present value (2007 base year) of US$14 billion in 2099 (constant 1990 prices) for the B2 scenario and US$21 billion for the BAU scenario. These costs were calculated on the basis of very conservative estimates of the cost of environmental degradation. Mitigation and adaptation costs are likely to be quite high though a small fraction of projected total investment costs.
author2	NU. CEPAL
author_facet	NU. CEPAL
format	Texto
title	The impact of climate change on the macroeconomy in the Caribbean
title_short	The impact of climate change on the macroeconomy in the Caribbean
title_full	The impact of climate change on the macroeconomy in the Caribbean
title_fullStr	The impact of climate change on the macroeconomy in the Caribbean
title_full_unstemmed	The impact of climate change on the macroeconomy in the Caribbean
title_sort	impact of climate change on the macroeconomy in the caribbean
publisher	ECLAC
publishDate	2015
url	http://hdl.handle.net/11362/38286
_version_	1718440106917888000

The impact of climate change on the macroeconomy in the Caribbean

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