| Abstract: |
Economics has a key role to play for understanding vulnerability and
adaptation to climate change. However, economic approaches to climate
adaptation are rarely articulated and discussed at a framework level. This
article first reviews and critically assesses welfare economics approaches to
climate adaptation and, secondly, develops a novel institutional economics
approach to climate adaptation. Concepts and tools of welfare economics have
contributed to assessments of benefits and costs of adaptation; outlined
strategies for adaptation; identified responsibilities of the public sector
and described policy instruments for adaptation. However, the neoclassical
framing of collective action based on the concept of market failure seems too
narrow to do analytical justice to the multitude of governance challenges
associated with adaptation. Adaptation economics seems underequipped with
analytical tools to study the role of institutions for climate adaptation.
Therefore, an institutional economics approach to climate adaptation is
developed and illustrated. This approach contributes to integrated economic
analyses of climate adaptation in three major ways: First, by broadening the
scope of climate adaptation economics; second, by delivering a diagnostic
framework of climate adaptation that enables the analyst to explain adaptation
processes in a systematic manner, synthesizes findings from a large number of
research efforts, places particular research questions, governance problems
and results in a broader context, and can guide the design of theoretical and
empirical inquiries of climate adaptation; third, by offering research
strategies and methods for developing generalisable and valid insights in the
face of pronounced heterogeneity and diversity of climate adaptation. -- |