Climate change is increasingly evident , and the design of effective climate adaptation policies is important for regional and sectoral economic growth. We propose different modelling approaches to quantify the socio-economic impacts of climate change on three vulnerable countries (Kazakhstan, Georgia, and Vietnam) and design specific adaptations. We use a Dynamic General Equilibrium (DGE) model for Vietnam and an economy-energy-emission (E3) model for the other two countries. Our simulations until 2050 show that selected adaptation measures , in particular in the agricultural sector , have positive implications for GDP. However, some adaptation measures can even increase greenhouse gas emissions. Focusing on GDP alone can lead to welfare-reducing policy decisions.
Acevedo, S., Mrkaic, M., Novta, N., Pugacheva, E., & Topalova, P. (2020). The Effects of Weather Shocks on Economic Activity: What Are the Channels of Impact? Journal of Macroeconomics, 65, Article ID: 103207. https://doi.org/10.1016/j.jmacro.2020.103207
Aguiar, A., Chepeliev, M., Corong, E. L., McDougall, R., & van der Mensbrugghe, D. (2019). The GTAP Data Base: Version 10. Journal of Global Economic Analysis, 4, 1-27. https://doi.org/10.21642/JGEA.040101AF
Batten, S. (2018). Climate Change and the Macro-Economy: A Critical Review. Bank of England Working Paper No. 706. Bank of England. https://doi.org/10.2139/ssrn.3104554
Batten, S., Sowerbutts, R., & Tanaka, M. (2016). Let’s Talk about the Weather: The Impact of Climate Change on Central Banks. Bank of England Working Paper No. 603. Bank of England. https://doi.org/10.2139/ssrn.2783753
Cavallo, E., & Noy, I. (2011). Natural Disasters and the Economy—A Survey. International Review of Environmental and Resource Economics, 5, 63-102. https://doi.org/10.1561/101.00000039
Chateau, J., Bibas, R., & Lanzi, E. (2018). Impacts of Green Growth Policies on Labour Markets and Wage Income Distribution: A General Equilibrium Application to Climate and Energy Policies. OECD Working Paper Series, No. 137. OECD.
Ciccarelli, M., & Marotta, F. (2021). Demand or Supply? An Empirical Exploration of the Effects of Climate Change on the Macroeconomy. ECB Working Paper No. 2021/2608. ECB. https://doi.org/10.2139/ssrn.3943014
Drygalla, A., Heinisch, K., & Schult, C. (2023). Supporting Climate Resilient Economic Development in Vietnam. The “Dynamic General Equilibrium Model for Climate Resilient Economic Development” (DGE-CRED) Technical Report. GIZ. https://www.giz.de/de/downloads/giz2023-en-technical-report-dge-cred-model-vietnam.pdf
Ebrey, R., Ruiter, M., Botzen, W. et al. (2021). Study on Adaptation Modelling: Comprehensive Desk Review: Climate Adaptation Models and Tools. European Commission—Directorate-General for Climate Action. https://data.europa.eu/doi/10.2834/280156
European Commission (2021). Directorate-General for Climate Action. In R. Ebrey, M. Ruiter, W. Botzen, et al., Eds., Study on Adaptation Modelling: Comprehensive Desk Review: Climate Adaptation Models and Tools. Publications Office. https://data.europa.eu/doi/10.2834/280156
Flaute, M., Reuschel, S., Lutz, C., Banning, M., & Hohmann, F. (2022). Supporting Climate Resilient Economic Development in Georgia. Application of the E3.Ge Model to Analyze the Economy-Wide Impacts of Climate Change Adaptation. GIZ. https://downloads.gws-os.com/giz2022-en-supporting- climate-resilient-economic-development-in-georgia.pdf
Großmann, A., & Hohmann, F. (2019). Static and Dynamic Input-Output Modelling with Microsoft Excel. SHAIO Conference Paper. https://downloads.gws-os.com/GrossmannHohmann2019_DIOM-X.pdf
Großmann, A., & Hohmann, F. (2022). Macroeconomic Modelling for Climate Policy Planning. Impact Analysis with an Excel-Based E3 (Economy-Energy-Emission) Model Building Framework. GIZ. https://downloads.gws-os.com/giz-2022-EN-CRED- macroeconomic-modelling-for-climate-policy-planning.pdf
Großmann, A., Flaute, M., Lutz, C., Hohmann, F., & Banning, M. (2023). Modeling Climate Resilient Economic Development. In W. L. Filho, M. Kovaleva, F. Alves, & I. R. Abubakar (Eds.), Climate Change Strategies: Handling the Challenges of Adapting to a Changing Climate (pp. 57-75). Springer. https://doi.org/10.1007/978-3-031-28728-2_4
Großmann, A., Hohmann, F., Lutz, C., & Reuschel. (2022). Supporting Climate Resilient Economic Development in Kazakhstan. Application of the E3.Kz Model to Analyze the Economy-Wide Impacts of Climate Change Adaptation. GIZ. https://www.giz.de/de/downloads/giz2022-en-supporting-climate- resilient-economic-development-in-kazakhstan.pdf
Großmann, A., Hohmann, F., Lutz, C., Flaute, M., Heinisch, K., Schult, C., & Banning, M. (2023). Lessons Learnt from Piloting Macroeconomic Modelling for Climate Resilience in Georgia, Kazakhstan and Vietnam. GIZ. https://www.giz.de/en/downloads/giz2023-en-global-report.pdf
Hassler, J., & Krusell, P. (2018). Environmental Macroeconomics. In P. Dasgupta, S. K. Pattanayak, & V. K. Smith (Eds.), Handbook of Environmental Economics (Vol. 4, Chapter 8, pp. 333-394). Elsevier.
Heutel, G. (2012). How Should Environmental Policy Respond to Business Cycles? Optimal Policy under Persistent Productivity Shocks. Review of Economic Dynamics, 15, 244-264. https://doi.org/10.1016/j.red.2011.05.002
Hsiang, S., Kopp, R., Jina, A., Rising, J., Delgado, M., Mohan, S. et al. (2017). Estimating Economic Damage from Climate Change in the United States. Science, 356, 1362-1369. https://doi.org/10.1126/science.aal4369
Hübler, M., Klepper, G., & Peterson, S. (2008). Costs of Climate Change: The Effects of Rising Temperatures on Health and Productivity. Ecological Economics, 68, 381-393. https://doi.org/10.1016/j.ecolecon.2008.04.010
IPCC (2022a). Climate Change 2022: Mitigation of Climate Change. In P. R. Shukla, J. Skea, R. Slade, A. Al Khourdajie, R. van Diemen, D. McCollum, M. Pathak, S. Some, P. Vyas, R. Fradera, M. Belkacemi, A. Hasija, G. Lisboa, S. Luz, & J. Malley, Eds., Contribution of Working Group III to the Sixth Assessment Report of the Intergovernmental Panel on Climate Change. Cambridge University Press.
IPCC (2022b). Summary for Policymakers. In H.-O. Pörtner, D. C. Roberts, E. S. Poloczanska, K. Mintenbeck, M. Tignor, A. Alegría, M. Craig, S. Langsdorf, S. Löschke, V. Möller, & A. Okem, Eds., Climate Change 2022: Impacts, Adaptation, and Vulnerability. Contribution of Working Group II to the Sixth Assessment Report of the Intergovernmental Panel on Climate Change. Cambridge University Press.
Jaumotte, F., Liu, W., & McKibbin, W. J. (2021). Mitigating Climate Change: Growth-Friendly Policies to Achieve Net Zero Emissions by 2050. IMF Working Papers, 2021/195. IMF.
Kahn, M. E., Mohaddes, K., Ng, R.N.C., Pesaran, M. H., Raissi, M., & Yang, J.-C. (2021). Long-Term Macroeconomic Effects of Climate Change: A Cross-Country Analysis. Energy Economics, 104, Article ID: 105624. https://doi.org/10.1016/j.eneco.2021.105624
Kemal, A. W., Mohammed, A. A., & Lelamo, L. L. (2022). Pastoralists’ Adaptation Strategies to Climate Change and Determinant Factors in Korahey Zone, Ethiopia. American Journal of Climate Change, 11, 79-102. https://doi.org/10.4236/ajcc.2022.112005
Lehr, U., & Lutz, C. (2020). Macro-Econometric and Structural Models. In U. Lehr, & C. Lutz (Eds.), Routledge Handbook of Energy Economics (pp. 473-481). Routledge. https://doi.org/10.4324/9781315459653-34
Lehr, U., Flaute, M., Nieters, A., Ahmann, L., Hirschfeld, J., Welling, M. et al. (2020). Vertiefte ökonomische Analyse einzelner Politikinstrumente und Maßnahmen zur Anpassung an den Klimawan-del. UBA Climate Change 43/2020. Umwelt Bundesamt.
McKibbin, W., & Wilcoxen, P. (1999). The Theoretical and Empirical Structure of the G-Cubed Model. Economic Modelling, 16, 123-148. https://doi.org/10.1016/S0264-9993(98)00035-2
McKibbin, W., & Wilcoxen, P. (2013). A Global Approach to Energy and the Environment: The G-Cubed Model. In P. B. Dixon, & D. W. Jorgenson (Eds.), Handbook of Computable General Equilibrium Modeling (Vol. 1, pp. 995-1068). Elsevier. https://doi.org/10.1016/B978-0-444-59568-3.00015-8
Nikas, A., Doukas, H., & Papandreou, A. (2019). A Detailed Overview and Consistent Classification of Climate-Economy Models. In H. Doukas, A. Flamos, & J. Lieu (Eds.), Understanding Risks and Uncertainties in Energy and Climate Policy. Springer.
Nordhaus, W. D. (1977). Economic Growth and Climate: The Carbon Dioxide Problem. American Economic Review, 67, 341-346. https://www.jstor.org/stable/1815926
Nordhaus, W. D. (2017). Revisiting the Social Cost of Carbon. Proceedings of the National Academy of Sciences of the United States of America, 114, 1518-1523, https://doi.org/10.1073/pnas.1609244114
Nordhaus, W. D., & Sztorc, P. (2013). DICE 2013R: Introduction and User’s Manual. Version Second. https://williamnordhaus.com/dicerice-models
Rising, J. A., Taylor, C., Ives, M. C., & Ward, R. E. T. (2022). Challenges and Innovations in the Economic Evaluation of the Risks of Climate Change. Ecological Economics, 197, Article ID: 107437. https://doi.org/10.1016/j.ecolecon.2022.107437
Schwarze, R., Oberpriller, Q., Peter, M., & Füssler, J. (2022). Modelling the Cost and Benefits of Adaptation. A Targeted Review on Integrated Assessment Models with a Special Focus on Adaptation Modelling. In C. Kondrup, et al., Eds., Climate Adaptation Modelling. Springer Climate. Springer, Cham. https://doi.org/10.1007/978-3-030-86211-4_1
Steininger, K. W., Bednar-Friedl, B., Formayer, H., & König, M. (2016). Consistent Economic Cross-Sectoral Climate Change Impact Scenario Analysis: Method and Application to Austria. Climate Services, 1, 39-52. https://doi.org/10.1016/j.cliser.2016.02.003
UNDP (2014). Disaster Risk Reduction Capacity Assessment Report. United Nations Development Programme. https://www.undp.org/georgia/publications/disaster- risk-reduction-capacity-assessment-report-2014
United Nations Climate Change (2022). Integrated Assessment Models (IAMs) and Energy-Environment-Economy (E3) Models. https://unfccc.int/topics/mitigation/workstreams/response-measures/modelling- tools-to-assess-the-impact-of-the-implementation-of-response-measures/integrated- assessment-models-iams-and-energy-environment-economy-e3-models
USAID (2016). The Georgian Road Map on Climate Change Adaptation. Color Ltd.
Vrontisi, Z., Charalampidis, I., Lehr, U., Meyer, M., Paroussos, L., Lutz, C. et al. (2022). Macroeconomic Impacts of Climate Change on the Blue Economy Sectors of Southern European Islands. Climatic Change, 170, Article No. 27. https://doi.org/10.1007/s10584-022-03310-5
World Bank (2020). Impacts of Climate Change on Georgia’s Coastal Zone: Vulnerability Assessment and Adaptation Options. The World Bank.
World Bank (2022). World Bank Group Macroeconomic Models for Climate Policy Analysis. Equitable Growth, Finance and Institutions Notes. The World Bank. https://openknowledge.worldbank.org/handle/10986/36833