Abstract
The objective of this research was to evaluate investment as a robust adaptation strategy in response to projected climate change in China. Four scenarios combining climate change and investment have been simulated in the model, which was established by adopting the standard approach of modern optimal economic growth theory; it also includes two discount factors from the climate sector (i.e., flood damage from climate variability and climate change). Relations between the flood prevention infrastructure and flood damage to the agricultural and the nonagricultural sectors were established from historical data and applied to estimate the benefit of investment to mitigate flood damage from climate variability. By assuming that the marginal adaptation costs to flood damage from projected climate change is the same as those from current climate variability, these relations were applied to estimate the benefit of investing in the mitigation of flood damage due to climate change. Tests were made to verify the model’s validity when the marginal adaptation cost for flood damage due to climate change was increased by 10%, 20%, and 30%, respectively. The conclusion is that optimized investment, taking climate change into consideration, effectively reduces the damage due to climate change and promotes the capacity to mitigate flood damage due to climate variability. Moreover, consumption and production increases regardless of whether climate change occurs.
Similar content being viewed by others
References
Bates BC, Charles SP, Sumner NR, Fleming PM (1995) Impact of climate change on Australia’s surface water resources. In: Proceedings, greenhouse 94 conference, October 1994, Wellington, New Zealand, CSIRO
Bo FX (1998) Agricultural disaster reduction and China agricultural development in century 21 (in Chinese). Disaster Reduction in China 8(2):23–25
Bultot F, Gellens D, Spreafico M, Schadler B (1992) Repercussions of a CO2 doubling on the water-balance: a case study in Switzerland. Journal of Hydrology 137:199–208
Chiew FHS, Whetton PH, McMahon TA, Pittock AB (1995) Simulation of the impacts of climate change on runoff and soil moisture in Australian catchments. Journal of Hydrology 167:121–147
Deng YM (1999) Achievements in water management in the last 50 years and prospect in century 21 (in Chinese). Disaster Reduction in China 9(3):25–30
Editorial Board of China Agricultural Encyclopedia (1987) China agricultural encyclopedia: water Conservancy (A). Agricultural Publishing House, Beijing
Gao ZQ, Liu JY, Zhuang DF (1998) The dynamic changes of the gravity center of the farmland area and the quality of the farmland ecological background in China (in Chinese with English abstract). Journal of Natural Resources 13(1):92–96
Gellens D (1991) Impact of a CO2-induced climate change on river flow variability in three rivers in Belgium. Earth Surface Processes Landforms 16:619–625
Gellens D, Roulin E (1998) Streamflow response of Belgian catchments to IPCC climate change scenarios. Journal of Hydrology 210:242–258
IPCC (1996) Climate change 1995: impacts, adaptation and mitigation of climate change: scientific-technical analyses. Cambridge University Press, Cambridge, UK, p 831
IPCC (1998) The regional impacts of climate change: an assessment of vulnerability. Cambridge University Press, Cambridge, UK, p 5
Jiang JL, Ruan GF, Ren L (1998) Analysis on effect of technology progress on economic development in China. In: Jiang J (ed) Estimation of technology progress contribution to economic development: theory and practice (in Chinese). China Planning Press, Beijing, pp 51–62
Karl TR, Knight RW (1998) Secular trends of precipitation amount, frequency and intensity in the United States. Bulletin of the American Meteorological Society 79:231–241
Knox JC (1993) Large increases in flood magnitude in response to modest changes in climate. Nature 361:430–432
Kong SH (1999) Effects of transfer of surplus rural labor on advance of industrial structure (in Chinese). China Economics Publishing House, Beijing
Kwadijk J, Middelkoop H (1994) Estimation of impact of climate change on the peak discharge probability of the River Rhine. Climate Change 27:199–224
Li JW (1997) Study on flood prevention of main rivers. In: Technical and economical evaluation on key projects for next century (in Chinese). Social Science and Archive Publishing House, Beijing, pp 296–347
Li Y, Shen ZH, Guo N (2000) One birth or two births (in Chinese)? Life Weekly 10:31–44
Li YY (1997) Microeconomic analysis (A) (in Chinese). Tsinghua University Publishing House, Beijing
Liu SK (1993) Booklet on flood prevention and disaster reduction (in Chinese). People Publishing House of Liaoning, Shenyang, p 79
Masui T, Morita T, Kyogoku J (2000) Analysis of recycling activities using multi-sectoral economic model with material flow. European Journal of Operational Research 122:405–415
McGuffie K, Henderson-Sellers A, Holbrook N (1999) Assessing simulations of daily temperature and precipitation variability with global climate models for present and enhanced greenhouse climates. International Journal of Climatology 19:1–26
Ministry of Agriculture, PRC (1996) China agricultural development report 96 (in Chinese). China Agricultural Press, Beijing, pp 42–45
Nordhaus WD (1994) Managing the global commons: the economics of climate change. MIT Press, Cambridge, MA
Osborn TJ, Hulme M, Jones PD, Basnet TA (2000) Observed trends in the daily intensity of United Kingdom precipitation. International Journal of Climatology 20:347–364
Panagoulia D, Dimou G (1997) Sensitivity of flood events to global climate change. Journal of Hydrology 191:208–222
Sefton CEM, Boorman DB (1997) A regional investigation of climate change impacts on UK streamflows. Journal of Hydrology 195:26–44
Shi QQ, Qin BT (1998) Study on effect of technology progress on economic development. In: Jiang J (ed) Estimation of technology progress contribution to economic development: theory and practice (in Chinese). China Planning Press, Beijing, pp 13–50
SPC (State Planning Commission), SSB (State Statistical Bureau) (1998) Announcement of estimation of technology progress contribution to economic development in China. Jikeji 2525, 1992. In: Jiang J (ed) Estimation of technology progress contribution to economic development: theory and practice (in Chinese). China Planning Press, Beijing, pp 1–12
SSB (1996) China Statistical Yearbook—1995 (in Chinese). China Statistical Publishing House, Beijing
SSB (1999) China Statistical Yearbook—1998 (in Chinese). China Statistical Publishing House, Beijing
Zhang X (2000) Economical analysis of flood and drought disasters in China (in Chinese). China Economics Publishing House, Beijing, pp 79
Zhu DJ (1999) Study on labor migration between rural and urban under market of three sectors (in Chinese). China Economics Publishing House, Beijing
Zhu XG, Liu YF (1998) Estimation of contribution of technology growth to agricultural development in China. In: Jiang J (ed) Estimation of technology progress contribution to economic development: theory and practice (in Chinese). China Planning Press, Beijing, pp 63–75
Author information
Authors and Affiliations
About this article
Cite this article
You, S., Takahashi, K. & Matsuoka, Y. Investment as an adaptation strategy to climate change: case study of flood damage in China. Environ Econ Policy Stud 4, 45–65 (2001). https://doi.org/10.1007/BF03353971
Received:
Accepted:
Published:
Issue Date:
DOI: https://doi.org/10.1007/BF03353971