Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5100848 | Journal of Housing Economics | 2017 | 23 Pages |
Abstract
The durability of the real estate capital stock could hinder climate change adaptation because past construction anchors the population in beautiful and productive but increasingly-risky coastal areas. However, coastal developers anticipate that their assets face increasing risk and this creates an incentive to seek adaptation strategies. This paper models climate change as a joint process of (1) increasingly destructive storms and (2) a risk of sea-level rise that submerges coastal property. We study how forward-looking developers and real estate investors respond to the new risks along a number of dimensions including their choices of location, capital durability, capital mobility (modular real estate), and maintenance of existing properties. The net effect of such investments is a more resilient urban population.
Keywords
Related Topics
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Economics and Econometrics
Authors
Devin Bunten, Matthew E. Kahn,