Global Impacts of Sea-level Rise: An assessment with the GEM-E3 model

The overall impact of sea-level rise (SLR) is one of the reasons of concern related to climate change (e.g. Smith et al., 2009). SLR can reach one metre by the end of the century, which might translate into large economic damages (World Bank, 2009). Sea level rise could severely affect productive activities located in the coastline (e.g. tourist resorts, industries such as refineries, and harbours). The objective of the article is to make an assessment of how much SLR can affect the world economy. Various assumptions on adaptation will be considered. The study will focus particularly on the relative importance of different impact categories. Some scenarios will focus on the damage from land loss (as was done, for example, in Bosello, 2011). Other scenarios will extend this analysis to take account of the costs of migration and sea floods, which together can account for more than 60% of the overall damage due to SLR (dependent on the extent of adaptation). This article will assess how much the global economic estimates change when this kind of broad coverage of economic damages is considered. This research builds on a previous study by Ciscar et al. (2011), which made a similar application for the case of Europe. The cost estimates of SLR come from the DIVA model (McFadden et al. 2007; Vafeidis et al. 2008). The DIVA model is an integrated model that can assess the consequences of SLR. It was used for assessing the impacts of SLR in Europe (Ciscar et al. 2011). The world GEM-E3 CGE model (Van Regemorter, 2005) is used to assess the economic impacts, following Ciscar et al. (2011). As noted, the model is shocked so as to reflect various impact categories. In particular, migration costs are interpreted as welfare losses and sea flood costs are modelled as productivity and capital losses. Alternative assumptions on how to shock the GEM-E3 model will be considered in order to assess their influence on the final results. Global economic damages from SLR will be computed for different climate change scenarios, comparing them under different assumptions on the implementation of the SLR coasts in the CGE model.