What if Dutch investors started worrying about flood risk? Implications for disaster risk reduction

Increasingly, roles and responsibilities of the public sector in flood risk management are receiving attention in research and policy. Part of the debate suggests that allocating risk to the private sector increases efficiency as it promotes individual adaptation, thereby reducing the impact if a disaster occurs. In this paper, we analyse the macroeconomic effects as risk-averse investors take flood risk into account in their investment decisions. Our case study is the large Rotterdam area in the Netherlands. Using a spatial computable general equilibium model, we find that the decrease in investments in risky areas leads to a reduction in capital and production in the large Rotterdam area leading to a reduction in potential monetary disaster losses, but not to a reduction in population. The reallocation of risk reduces the long-term impacts from a flood on government tax revenues, but it also leads to welfare losses among households residing in risky regions

Volume 3 Chapter 6: Transformation paths

There is little doubt that the currently observed patterns of climate change are predominantly caused by human activity (Volume 1, Chapter 1). This chapter addresses the challenge of stabilizing climate change at 2 degrees C and particularly focuses on the questions which mitigation and adaptation measures in Austria can contribute to achieve this goal. Additionally, a number of desirable co-benefits pertaining to socio-ecological transformation leading towards limiting climate change are analysed. In the Copenhagen Accord (UNFCC) and in the EU-Ruling, a goal of limiting the rise of global average temperature to +2 degrees C compared to pre-industrial times has been deemed as necessary to limit dangerous anthropogenic climate change impacts, despite calls from scientists to consider a +1.5 degrees C target. It is an internationally accepted target supported by a broad number of supporters, including industrialized and developing countries as well as non-state actors. Without actions towards reducing emissions, significant negative impacts on the socio-economic conditions in Austria can be expected. This derives an important obligation to undertake necessary mitigation measures in Austria. Mitigation and adaptation measures are necessary, but by themselves provide insufficient conditions for sustainable development. Achievement of the 2 degrees C target requires a focus on climate friendly technologies, as well as behavioural - and institutional change. In particular, the activities of energy provision and consumption, industrial processes and agriculture deserve attention: in 2012, the energy sector activities caused 74.6% of GHG emissions (with one third originating from road transport), industrial processes caused 13.6%, and agriculture triggered 9.4% of emissions, (excluding emission effects of forest cover expansion, cf. Anderl et al., 2014). The corresponding figures for 2010 are: energy sector 75.9%, industrial processes: 12.7%, agriculture: 8.8% (Anderl et al., 2014). To stabilize the climate, the climate impact criteria have to be integrated in all decisions regarding investment, production, politics and consumption, in order to reduce the risk of irreversible changes. At the same time, the social- and economic framing conditions must be respected. Measures to address climate change have to be integrated into the broader criteria of sustainability. Discussions of climate protection measures are typically reduced to additional costs and undesirable changes. Thereby the manifold potential co-benefits of such measures, for example with respect to quality of life, health, employment, rural development, environmental protection, security of supply, and international trade balances are mostly ignored. Integrating these criteria and effects into the analysis is required for being able to display the full spectrum of options for addressing climate change

Closing the gaps. A framework for understanding policies and actions to address losses and damages

Global failures to mitigate and adapt to the climate crisis are causing massive losses and costly damages to the lives, livelihoods, and futures of communities around the world. Efforts to address the issue have been highly insufficient, and national and international humanitarian response systems are already overstretched and underfunded. There is a moral imperative to act in solidarity with those who are suffering now, and to develop an approach that will protect generations to come. This policy brief from the Zurich Flood Resilience Alliances explains how we got to this point, and makes urgent recommendations outlining how the international community can to scale up action, and resource a comprehensive approach to averting, minimizing, and addressing losses and damages

Integrated assessment of short-term direct and indirect economic flood impacts including uncertainty quantification

Understanding and quantifying total economic impacts of flood events is essential for flood risk management and adaptation planning. Yet, detailed estimations of joint direct and indirect flood-induced economic impacts are rare. In this study an innovative modeling procedure for the joint assessment of short-term direct and indirect economic flood impacts is introduced. The procedure is applied to 19 economic sectors in eight federal states of Germany after the flood events in 2013. The assessment of the direct economic impacts is object-based and considers uncertainties associated with the hazard, the exposed objects and their vulnerability. The direct economic impacts are then coupled to a supply-side Input-Output-Model to estimate the indirect economic impacts. The procedure provides distributions of direct and indirect economic impacts which capture the associated uncertainties. The distributions of the direct economic impacts in the federal states are plausible when compared to reported values. The ratio between indirect and direct economic impacts shows that the sectors Manufacturing, Financial and Insurance activities suffered the most from indirect economic impacts. These ratios also indicate that indirect economic impacts can be almost as high as direct economic impacts. They differ strongly between the economic sectors indicating that the application of a single factor as a proxy for the indirect impacts of all economic sectors is not appropriate