A macroeconomic analysis of adaptation to climate change impacts on forests in India |
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Authors: | Asbjørn Aaheim Ranjith Gopalakrishnan Rajiv Kumar Chaturvedi N H Ravindranath Anitha D Sagadevan Nitasha Sharma Taoyuan Wei |
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Institution: | (1) CICERO, Center for International Climate and Environmental Research—Oslo, P.O. Box 1129, Blindern, 0318 Oslo, Norway;(2) Centre for Sustainable Technology, Indian Institute of Science, Bangalore, 560 012, India |
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Abstract: | We examine the potential for adaptation to climate change in Indian forests, and derive the macroeconomic implications of
forest impacts and adaptation in India. The study is conducted by integrating results from the dynamic global vegetation model
IBIS and the computable general equilibrium model GRACE-IN, which estimates macroeconomic implications for six zones of India.
By comparing a reference scenario without climate change with a climate impact scenario based on the IPCC A2-scenario, we
find major variations in the pattern of change across zones. Biomass stock increases in all zones but the Central zone. The
increase in biomass growth is smaller, and declines in one more zone, South zone, despite higher stock. In the four zones
with increases in biomass growth, harvest increases by only approximately 1/3 of the change in biomass growth. This is due
to two market effects of increased biomass growth. One is that an increase in biomass growth encourages more harvest given
other things being equal. The other is that more harvest leads to higher supply of timber, which lowers market prices. As
a result, also the rent on forested land decreases. The lower prices and rent discourage more harvest even though they may
induce higher demand, which increases the pressure on harvest. In a less perfect world than the model describes these two
effects may contribute to an increase in the risk of deforestation because of higher biomass growth. Furthermore, higher harvest
demands more labor and capital input in the forestry sector. Given total supply of labor and capital, this increases the cost
of production in all the other sectors, although very little indeed. Forestry dependent communities with declining biomass
growth may, however, experience local unemployment as a result. |
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