Mohaddes, K. and Williams, R. J.

The Adaptive Investment Effect: Evidence from Chinese Provinces

Economics Letters

Vol. 193 no. 109332 pp. 1-4 (2020)

Abstract: This paper investigates the “adaptive investment effect”, a redirection of investment towards adaptive capital in order to mitigate the negative effects of climate change. We find that the impact of investment on economic growth is reduced by between 27% and 37% in Chinese provinces investing more in adaptive capital. This implies that the benefits from mitigation policies are greater than existing studies suggest.

Keywords: Climate change, Adaptation, Investment, China

JEL Codes: C33, O40, O53, Q51, Q54

Author links: Kamiar Mohaddes  

Publisher's Link: https://doi.org/10.1016/j.econlet.2020.109332

Cambridge Working Paper in Economics Version of Paper: The Adaptive Investment Effect: Evidence from Chinese Provinces, Mohaddes, K., and Williams, R., (2020)