Adaptation for Mitigation
Tinbergen Institute Discussion Paper 14-126/III
42 Pages Posted: 20 Sep 2014
Date Written: September 19, 2014
This paper develops a dynamic model consisting of two regions (North and South), in which the accumulation of human capital is negatively influenced by the global stock of pollution. By characterizing the equilibrium strategy of each region, we show that the regions' best responses can be strategic complements through a dynamic complementarity effect. The model is used to analyze the impact of adaptation assistance from North to South. It is shown that North's unilateral assistance to South (thus enhancing South's adaptation capacity) can facilitate pollution mitigation in both regions, especially when the assistance is targeted at human capital protection.
Keywords: Climate change, mitigation, adaptation, human capital
JEL Classification: D91, Q54, Q58
Suggested Citation: Suggested Citation