The aim of our research on climate change economics is to improve understanding of interactions between climate change and the economy to guide the design of climate change mitigation and adaptation policies.
Examples are studies on the economic consequences of sea level rise, extreme heat, and natural disasters, such as flooding, which are used in cost-benefit analyses of adaptation strategies, including nature based solutions.
Below an overview
GRACE is a Horizon EU project that focuses on addressing the needs of rural and small/medium communities in remote regions across the EU to adapt to climatic changes. GRACE is a consortium of 27 organizations from 16 countries, with 5 Demonstrator Regions in Austria, Denmark, Italy, Portugal and Sweden, and 5 Replicator Regions (RRs) in Greece, Ireland, Latvia, Slovakia and Ukraine, aiming to co-develop nature-based approaches for increasing climate change resilience, and to deliver social, environmental and economic benefits. The project will enhance local socio-economic activities, promote circular business models, maximize the value of natural capital, and help mitigate the challenges of depopulation and aging in remote EU regions. IVM leads the work on assessing socio-economic benefits from nature-based solutions in these regions.
Contact information: Dr. Marije Schaafsma and Dr. Mark Koetse
Natural disasters, exacerbated by climate change, pose a growing economic threat. Conventional insurance risk assessments often focus on single hazards and overlook the complex interplay of multi-hazard risks influenced by climate shifts. Additionally, they neglect the role of human adaptation processes in risk reduction. The ERC-funded INSUREADAPT project will develop multi-hazard climate risk assessments for insurance. It employs agent-based models (ABMs) to understand how people make constrained rational adaptation choices, considering social interactions. Through real-time surveys and economic experiments, INSUREADAPT aims to craft innovative insurance arrangements. These arrangements will encourage policyholders to adapt to evolving multi-hazard climate risks by merging financial coverage with tailored strategies, including communication, incentives like deductibles and premium discounts, and nudges.
Contact information: Prof. Wouter Botzen, Dr Peter Robinson and Dr Sanchayan Banerjee
Assessing Climate Change Risk in Europe (ACCREU), aims to advance knowledge regarding climate change risk and adaptation that can be used directly by stakeholder communities. IVM is responsible for the modelling of the impact of the flood insurance market in Europe. In particular we focus on the financial feasibility of insurance under climate change and the effect of insurance on adaptation decisions by both households and small businesses.
Project website: https://www.accreu.eu/
Contact information: Prof. Wouter Botzen, Dr Jan Brusselaers, Dr Max Tesselaar and Michiel Ingels
The Naturance project explores the technical, financial, and operational feasibility and effectiveness of solutions that merge disaster risk financing and investments with nature-based solutions (NbS). IVM’s role in the project is focused on methods for assessing the effectiveness of NbS. First, we focus on reviewing catastrophe models and methods to assess the co-benefits achieved by NbS. We will also improve current methods, both catastrophe models for risk-reduction and stated preference methods for co-benefits valuation, in order provide recommendations that are policy relevant and can enhance mechanisms for financing NbS, both from the public and private sector. To wrap up, we will provide recommendations on integrating NbS into insurance schemes.
Project website: https://www.naturanceproject.eu/
Contact information: Prof. Wouter Botzen, Dr Max Tesselaar and Guillermo García Álvarez
Climate change and rising sea levels and urbanization in low lying areas will increase the risk of coastal floods, erosion and salinization. Adaptation to reduce future environmental risks is inevitable, but it is unclear which coastal areas will be protected and in which regions residents will be forced to migrate. The EU-ERC COASTMOVE project aims to address the challenges these trends pose to adaptation and migration policy. To this end, it will focus on the adaptive and migration behaviour of residents and other agents by further develop the regional DYNAMO model into a coupled global coastal risk and climate adaptation model. For this, we combine an agent-based model (ABM) with a gravity model and a global risk model. The DYNAMO model will be used to develop and evaluate adaptation and migration policies.
Project website: https://coastmove.wordpress.com/
Contact information: Prof. Wouter Botzen, Sem Duijndam, Dr Liselotte Hagedoorn and Moongyeom Kim
To support adaptation to climate change, the use of climate information could play a pivotal role. The I-CISK project is a EU Horizon2020 funded explores how climate information is used, interpreted and acted on, with the ambition to design Climate Services (CS) that follow a human centred, social and behaviourally informed approach; integrating the knowledges, needs and perceptions of climate information. I-CISK will develop tailored CS prototypes with and for stakeholders in Spain, Italy, the Netherlands, Greece, Hungary, Georgia and Lesotho. The work of the IVM team involves supporting and evaluation the co-creation approach, socio-hydrological modelling of droughts, and assessing behavioural responses to climate service prototypes.
Project website: https://icisk.eu
Contact information: Dr Marije Schaafsma and Lotte Muller
REACHOUT is a research project aiming to enhance user-oriented climate services. All research partners collaborate to create a Triple-A toolkit, supporting seven EU city hubs in analyzing climate hazards, setting resilient urban development ambitions, and implementing adaptation actions. The IVM contributes to REACHOUT through the development of new tools to assess the impacts of climate change on the financial sector and real estate investments in particular. The effects of flooding on losses to real estate and housing prices are analyzed, using both survey data from real-world flood events and modelling techniques.
Project website: https://reachout-cities.eu/
Contact information: Thijs Endendijk and Prof. Wouter Botzen
DISCC-AT is concerned with estimating social vulnerability to climate stressors in Austria, in particular heat and flooding. The aim is to provide Austrian policymakers with more accurate information regarding the societal impacts of these hazards, and how these will develop due to climate change. For example, besides the physical impacts of flooding to the built environment, floods may have more indirect and long-term impacts, which may be particularly severe for low-income households, as they may have less means to recover and adapt to such risks. Therefore, climate risk management may need to pay special attention to such vulnerable societal groups, that may be obscured when only considering impacts to assets. The project applies qualitative methods to explore social vulnerability indicators to extreme heat and flooding, and quantitative techniques to spatially assess vulnerability to these climate risks in Austria.
Project website: http://www.discc.at/
Contact information: Dr Max Tesselaar and Prof. Wouter Botzen
Small islands are particularly vulnerable to climate change because of their fragile ecosystems, small economies, and often extensive, low-lying coastal areas. Therefore, small islands, such as present in the Caribbean Netherlands, are expected to suffer excessively from rising temperatures, changes in precipitation, sea-level rise, coral bleaching, cyclones, droughts and floods. Yet, scientific evidence of these effects in the Caribbean Netherlands is scarce.
In this study, an analysis is conducted assessing the impacts of climate change for the island of Bonaire. A mix of methods is used to estimate the impacts of climate change, including climate and flood models, ecological-economic models, as well as social-science methods such as social media analysis and participatory mapping. Four sub-studies can be distinguished: the estimation of the biophysical impacts, the modelling of economic effects, the identification of socio-cultural effects, and the exploration for potential adaptation options.
Contact information: Prof. Pieter van Beukering
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