in the FUND model (Tol 2002a,b) exemplify the process-based approach. Both authors develop damage estimates on a regional basis by extrapolating from studies of the United States and other countries, but to implement the process-based approach requires many more assumptions about the detailed impacts of sea-level rise and the character of affected individuals’ adaptation responses.

Damages in the RICE model are constructed by developing a benchmark estimate of the cost of the sea level increase arising from 2°C warming in the United States (0.1% of GDP) and then applying this estimate to other regions using an index of coastal sensitivity. The benchmark estimate for the United States includes damages to developed and undeveloped land and damages from storms. The index of coastal sensitivity is constructed by dividing the ratio of coastal area to total area for a given region by the ratio for the United States (see Table 5-5). The income elasticity of coastal damages is assumed to be 0.2.

TABLE 5-5 Values of the Benchmarking Parameter (α)

 

Coastal Impacta

Coastal Index (% of GDP, 1990)

α (2.5°C Impact)

United States

1.00

0.10

0.11

China

0.71

0.07

0.07

Japan

4.69

0.47

0.56

Western Europe

5.16

0.52

0.60

Russia

0.94

0.09

0.09

India

1.00

0.10

0.09

Other high income

1.41

0.14

0.16

High-income OPEC

0.52

0.05

0.06

Eastern Europe

0.14

0.01

0.01

Middle income

0.41

0.04

0.04

Lower-middle income

0.94

0.09

0.09

Africa

0.23

0.02

0.02

Low income

0.94

0.09

0.09

Global

 

 

 

Output weighted

 

 

0.32

Population weighted§

 

 

0.12

aRatio of fraction of area in coastal zone in country to that fraction in the United States. “Coastal zone” is defined as that part of the region that lies within 10 kilometers of an ocean.

†Calibrated to impacts in the year 2100.

‡Output projections in 2100 from RICE model base case.

§1995 population.

SOURCE: Nordhaus and Boyer (2000: Tables 4-5 and 4-10). Reprinted with permission; copyright 2008, MIT Press.



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