Climate Uncertainty and Economic Development: Evaluating the Case of Mozambique to 2050

UNU-WIDER 04/2013; WP/2013/042

Posted: 26 Nov 2014

See all articles by Channing Arndt

Channing Arndt

United Nations - World Institute for Development Economics Research (UNU/WIDER)

James Thurlow

UNU-WIDER; International Food Policy Research Institute (IFPRI)

Date Written: April 2013

Abstract

We apply a probabilistic approach to the evaluation of climate change impacts in the Zambeze River Valley. The economic modeling relies on an economywide modeling approach. Taking a distribution of shocks as inputs, we create hybrid frequency distributions of the potential economic impacts of climate change for Mozambique. The approach identifies an explicit range of potential outcomes and associates a probability with given sets of outcomes. For example, we find that the economy of Mozambique may be up to 13% smaller in 2050 due to the effects of climate change. However, the chance of GDP losses of less than 5% are more than four out of five with about 10% of these outcomes actually positive. Large declines in GDP, defined as a decline greater than 10%, are the result of a dramatic reduction in flood return periods though the probability of large declines is relatively small at 2.5%. We conclude that this probabilistic approach provides significantly more information to policy makers and productively focuses scientific effort and the agenda for future research.

Suggested Citation

Arndt, Channing and Thurlow, James, Climate Uncertainty and Economic Development: Evaluating the Case of Mozambique to 2050 (April 2013). UNU-WIDER 04/2013; WP/2013/042, Available at SSRN: https://ssrn.com/abstract=2530896

Channing Arndt (Contact Author)

United Nations - World Institute for Development Economics Research (UNU/WIDER) ( email )

Katajanokanlaituri 6 B
Helsinki, FI‐00160
Finland

James Thurlow

UNU-WIDER ( email )

Katajanokanlaituri 6B
Helsinki, FIN-00160
Finland

International Food Policy Research Institute (IFPRI) ( email )

1201 Eye St, NW,
Washington, DC 20005
United States

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