Regional Flood Impacts and Adaptation in a Federal Setting: A Spatial Computable General Equilibrium Analysis for Switzerland

Hoffmann, Christin; Stephan, Gunter (2018). Regional Flood Impacts and Adaptation in a Federal Setting: A Spatial Computable General Equilibrium Analysis for Switzerland. Climate Change Economics, 09(02), p. 1850001. World Scientific Publishing 10.1142/S201000781850001X

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Climate change, a growing population and inappropriate land use may lead to a significant increase in the frequency, intensity and the duration of water-related extreme events. We aim (1) to gain a better understanding of the direct and indirect economic impacts of floods, (2) to analyze the issue of efficient flood adaption as well as the issue of financing adaptation in a federalist system, where local and national governmental authorities interplay in the provision of local public good adaptation. Our numerical thought experiments are based on a dynamic, spatial differentiated Ramsey type Computable General Equilibrium Model. Regions are determined by exposure and vulnerability to floods and are not identical with territorial units. Our results indicate: (1) general equilibrium effects caused by flood damages in vulnerable regions lead in regions of low vulnerability also to considerable welfare and GDP losses. (2) Providing local public good adaptation can at low economic costs significantly reduce negative impacts on welfare, GDP as well as the allocation of resources between regions and sectors. (3) Funding adaptation by imposing a regional land tax should be preferred to a national output tax or a combination of both with transfers from national to regional governments.

Item Type:	Journal Article (Original Article)
Division/Institute:	03 Faculty of Business, Economics and Social Sciences > Department of Economics 10 Strategic Research Centers > Oeschger Centre for Climate Change Research (OCCR)
UniBE Contributor:	Hoffmann, Christin, Stephan, Gunter
Subjects:	300 Social sciences, sociology & anthropology > 330 Economics
ISSN:	2010-0078
Publisher:	World Scientific Publishing
Language:	English
Submitter:	Monika Wälti-Stampfli
Date Deposited:	07 May 2018 15:13
Last Modified:	05 Dec 2022 15:13
Publisher DOI:	10.1142/S201000781850001X
URI:	https://boris.unibe.ch/id/eprint/116219