IDEAS home Printed from https://ideas.repec.org/a/eee/forpol/v63y2016icp43-51.html
   My bibliography  Save this article

Economic impacts of climate change considering individual, additive, and simultaneous changes in forest and agriculture sectors in Canada: A dynamic, multi-regional CGE model analysis

Author

Listed:
  • Ochuodho, Thomas O.
  • Lantz, Van A.
  • Olale, Edward

Abstract

Computable general equilibrium (CGE) model analyses of economic impacts from climate change have often focused on individual impacted sectors such as forest. However, such an approach may not provide accurate economic impact estimates since climate change will affect multiple sectors simultaneously. Furthermore, imprecise aggregate economic impact estimates may result if one were to add together individual sector impact estimates. We used CGE models to compare economic impacts of individual, additive, and simultaneous climate-induced changes in Canadian and other regions' forest and agriculture sectors over the 2006–2051 period. We found negative additive impact biases in a majority of regions for five of our economic variables including GDP, income, imports, terms of trade, capital, and total output. Positive additive impact biases were found in a majority of regions for four economic variables including welfare, consumption, export, and labor. These findings emphasize the importance of considering impacted sectors simultaneously when using CGE models to evaluate the economic impacts of climate change.

Suggested Citation

  • Ochuodho, Thomas O. & Lantz, Van A. & Olale, Edward, 2016. "Economic impacts of climate change considering individual, additive, and simultaneous changes in forest and agriculture sectors in Canada: A dynamic, multi-regional CGE model analysis," Forest Policy and Economics, Elsevier, vol. 63(C), pages 43-51.
    • Handle: RePEc:eee:forpol:v:63:y:2016:i:c:p:43-51
    DOI: 10.1016/j.forpol.2015.12.005
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1389934115300769
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.forpol.2015.12.005?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Tol, Richard S. J., 2005. "The marginal damage costs of carbon dioxide emissions: an assessment of the uncertainties," Energy Policy, Elsevier, vol. 33(16), pages 2064-2074, November.
    2. Darwin, Roy & Tsigas, Marinos E. & Lewandrowski, Jan & Raneses, Anton, 1995. "World Agriculture and Climate Change: Economic Adaptations," Agricultural Economic Reports 33933, United States Department of Agriculture, Economic Research Service.
    3. Andrea Bigano & Francesco Bosello & Roberto Roson & Richard Tol, 2008. "Economy-wide impacts of climate change: a joint analysis for sea level rise and tourism," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 13(8), pages 765-791, October.
    4. Francesco Bosello & Roberto Roson & Richard Tol, 2007. "Economy-wide Estimates of the Implications of Climate Change: Sea Level Rise," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 37(3), pages 549-571, July.
    5. Eboli, Fabio & Parrado, Ramiro & Roson, Roberto, 2010. "Climate-change feedback on economic growth: explorations with a dynamic general equilibrium model," Environment and Development Economics, Cambridge University Press, vol. 15(5), pages 515-533, October.
    6. Darwin, Roy & Tsigas, Marinos & Lewandrowski, Jan & Raneses, Anton, 1996. "Land use and cover in ecological economics," Ecological Economics, Elsevier, vol. 17(3), pages 157-181, June.
    7. Frankhauser, Samuel & Tol, Richard SJ, 1996. "Climate change costs : Recent advancements in the economic assessment," Energy Policy, Elsevier, vol. 24(7), pages 665-673, July.
    8. Niven Winchester & David Greenaway & Geoffrey V. Reed, 2006. "Skill Classification and the Effects of Trade on Wage Inequality," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 142(2), pages 287-306, July.
    9. Pahan Prasada & Maury E. Bredahl & Randall Wigle, 2010. "Market Impacts of Technological Change in Canadian Agriculture," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 58(2), pages 235-247, June.
    10. Marian Weber & Grant Hauer, 2003. "A Regional Analysis of Climate Change Impacts on Canadian Agriculture," Canadian Public Policy, University of Toronto Press, vol. 29(2), pages 163-179, June.
    11. Zhai, Fan & Lin, Tun & Byambadorj, Enerelt, 2009. "A General Equilibrium Analysis of the Impact of Climate Change on Agriculture in the People’s Republic of China," Asian Development Review, Asian Development Bank, vol. 26(1), pages 206-225.
    12. Richard S.J. Tol & Samuel Fankhauser & Richard G. Richels & Joel B. Smith, 2000. "How Much Damage Will Climate Change Do? Recent Estimates," Working Papers FNU-2, Research unit Sustainability and Global Change, Hamburg University, revised Sep 2000.
    13. William R. Cline, 2007. "Global Warming and Agriculture: Impact Estimates by Country," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 4037, April.
    14. Richard S.J. Tol & Samuel Fankhauser & Richard G. Richels & Joel B. Smith, 2000. "How Much Damage Will Climate Change Do?," World Economics, World Economics, 1 Ivory Square, Plantation Wharf, London, United Kingdom, SW11 3UE, vol. 1(4), pages 179-206, October.
    15. Hertel, Thomas, 1997. "Global Trade Analysis: Modeling and applications," GTAP Books, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, number 7685, December.
    16. Ochuodho, T.O. & Lantz, V.A. & Lloyd-Smith, P. & Benitez, P., 2012. "Regional economic impacts of climate change and adaptation in Canadian forests: A CGE modeling analysis," Forest Policy and Economics, Elsevier, vol. 25(C), pages 100-112.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Liu, Lirong & Huang, Charley Z. & Huang, Guohe & Baetz, Brian & Pittendrigh, Scott M., 2018. "How a carbon tax will affect an emission-intensive economy: A case study of the Province of Saskatchewan, Canada," Energy, Elsevier, vol. 159(C), pages 817-826.
    2. Cheng, Xiang & Wang, Wenfu & Chen, Xueli & Zhang, Wei & Song, Malin, 2024. "Carbon tariffs and energy subsidies: Synergy or antagonism?," Energy, Elsevier, vol. 306(C).
    3. Dong, Baomin & Ma, Xili & Wang, Ningjing & Wei, Weixian, 2020. "Impacts of exchange rate volatility and international oil price shock on China's regional economy: A dynamic CGE analysis," Energy Economics, Elsevier, vol. 86(C).
    4. Fragkos, Panagiotis & Tasios, Nikos & Paroussos, Leonidas & Capros, Pantelis & Tsani, Stella, 2017. "Energy system impacts and policy implications of the European Intended Nationally Determined Contribution and low-carbon pathway to 2050," Energy Policy, Elsevier, vol. 100(C), pages 216-226.
    5. Shaik, Saleem & Yeboah, Osei-Agyeman, 2018. "Does climate influence energy demand? A regional analysis," Applied Energy, Elsevier, vol. 212(C), pages 691-703.
    6. Lantz, Van & McMonagle, Galen & Hennigar, Chris & Sharma, Chinmay & Withey, Patrick & Ochuodho, Thomas, 2022. "Forest succession, management and the economy under a changing climate: Coupling economic and forest management models to assess impacts and adaptation options," Forest Policy and Economics, Elsevier, vol. 142(C).
    7. Dzyuba, Yu. & Bakalova, I., 2023. "CGE models for resource-based economy: A comprehensive bibliometric analysis," Journal of the New Economic Association, New Economic Association, vol. 61(4), pages 12-50.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Richard S J Tol, 2018. "The Economic Impacts of Climate Change," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 12(1), pages 4-25.
    2. Francesco Bosello & Lorenza Campagnolo & Raffaello Cervigni & Fabio Eboli, 2018. "Climate Change and Adaptation: The Case of Nigerian Agriculture," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 69(4), pages 787-810, April.
    3. Andrea Bigano & Francesco Bosello & Roberto Roson & Richard Tol, 2008. "Economy-wide impacts of climate change: a joint analysis for sea level rise and tourism," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 13(8), pages 765-791, October.
    4. Monge, Juan J. & Bryant, Henry L. & Gan, Jianbang & Richardson, James W., 2016. "Land use and general equilibrium implications of a forest-based carbon sequestration policy in the United States," Ecological Economics, Elsevier, vol. 127(C), pages 102-120.
    5. Bigano, Andrea & Bosello, Francesco & Roson, Roberto & Tol, Richard S.J., 2006. "Economy-Wide Estimates of the Implications of Climate Change: A Joint Analysis for Sea Level Rise and Tourism," Climate Change Modelling and Policy Working Papers 12022, Fondazione Eni Enrico Mattei (FEEM).
    6. Theodoros N. Chatzivasileiadis & Marjan W. Hofkes & Onno J. Kuik & Richard S.J. Tol, 2016. "Full economic impacts of sea level rise: loss of productive resources and transport disruptions," Working Paper Series 09916, Department of Economics, University of Sussex Business School.
    7. Tol, Richard S.J., 2006. "Why Worry About Climate Change? A Research Agenda," Climate Change Modelling and Policy Working Papers 12047, Fondazione Eni Enrico Mattei (FEEM).
    8. Santos, Cárliton Vieira dos & Oliveira, Aryeverton Fortes de & Filho, Joaquim Bento de Souza Ferreira, 2022. "Potential impacts of climate change on agriculture and the economy in different regions of Brazil," Revista de Economia e Sociologia Rural (RESR), Sociedade Brasileira de Economia e Sociologia Rural, vol. 60(01), January.
    9. Delpiazzo, Elisa & Parrado, Ramiro, 2016. "Analyzing the coordinated impacts of climate policies for financing adaptation and development actions," Conference papers 332737, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    10. Theodoros N. Chatzivasileiadis & Marjan W. Hofkes & Onno J. Kuik & Richard S.J. Tol, 2016. "Full economic impacts of sea level rise: loss of productive resources and transport disruptions," Working Paper Series 9916, Department of Economics, University of Sussex.
    11. John Asafu-Adjaye & Renuka Mahadevan, 2012. "Managing Macroeconomic Policies for Sustainable Growth," Books, Edward Elgar Publishing, number 14338.
    12. Roberto Roson & Martina Sartori, 2016. "Estimation of Climate Change Damage Functions for 140 Regions in the GTAP 9 Database," Journal of Global Economic Analysis, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, vol. 1(2), pages 78-115, December.
    13. Ruslana Rachel PALATNIK, 2008. "Climate Change Assessment and Agriculture in General Equilibrium Models: Alternative Modeling Strategies," EcoMod2008 23800101, EcoMod.
    14. Parrado, Ramiro & De Cian, Enrica, 2014. "Technology spillovers embodied in international trade: Intertemporal, regional and sectoral effects in a global CGE framework," Energy Economics, Elsevier, vol. 41(C), pages 76-89.
    15. Theodoros Chatzivasileiadis & Ignasi Cortes Arbues & Daniel Lincke & Jochen Hinkel & Theodoros Chatzivasileiadis & Richard S.J. Tol, "undated". "Actualised and future changes in regional economic growth through sea level rise," Working Paper Series 0324, Department of Economics, University of Sussex Business School.
    16. Richard S. J. Tol & Robert J. Nicholls & Sally Brown & Jochen Hinkel & Athanasios T. Vafeidis & Tom Spencer & Mark Schuerch, 2016. "Comment on ‘The Global Impacts of Extreme Sea-Level Rise: A Comprehensive Economic Assessment’," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 64(2), pages 341-344, June.
    17. Ochuodho, T.O. & Lantz, V.A. & Lloyd-Smith, P. & Benitez, P., 2012. "Regional economic impacts of climate change and adaptation in Canadian forests: A CGE modeling analysis," Forest Policy and Economics, Elsevier, vol. 25(C), pages 100-112.
    18. Roberto Roson & Martina Sartori, 2016. "Climate change damage (or, more correctly, impact) functions relate variations in temperature (or other climate variables) to economic impacts in various dimensions, and are at the basis of quantitati," IEFE Working Papers 86, IEFE, Center for Research on Energy and Environmental Economics and Policy, Universita' Bocconi, Milano, Italy.
    19. Winchester Niven & Paltsev Sergey & Reilly John M, 2011. "Will Border Carbon Adjustments Work?," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 11(1), pages 1-29, January.
    20. Karen Fisher-Vanden & Ian Sue Wing & Elisa Lanzi & David Popp, 2013. "Modeling climate change feedbacks and adaptation responses: recent approaches and shortcomings," Climatic Change, Springer, vol. 117(3), pages 481-495, April.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:forpol:v:63:y:2016:i:c:p:43-51. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/forpol .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.