Economic Evaluation of Climate Change Adaptation Projects

This guide form the World Bank highlights a number of key challenges and solutions to carrying out analysis of the economic viability of climate change adaption projects.

"Very few projects addressing adaptation thus far have been subject to in-depth and rigorous economic analysis for a variety of reasons, including a lack of guidance on how to deal with assessments of the impacts of climate change, as well as with estimating costs and benefits of adaptation under uncertainty. Our focus is on the agricultural sector, where the impacts of climate change have the potential to disrupt the livelihoods of rural populations in many regions and where adaptation must be given urgent consideration. Nevertheless, some of the approaches discussed are suitable to projects in other sectors as well." (The International Bank for Reconstruction and Development/The World Bank, 2010)


Specific Options Mentioned

  • Agronomic (crop) models – p. 11-15, 17-19
  • Ricardian (hedonic) models – p. 11, 15-20
  • Integrated Modeling System (IMS) – p. 14
  • HadRM3 – a regional climate model – p. 14
  • SWAT – a hydrological model – p. 14
  • EPIC – an agro-meteorological simulation model – p. 14
  • Statistical Downscaling Model – p. 16
  • Yields Impact Module – p. 16
  • General Equilibrium Model – p. 16
  • Probabilistic Options – p. 20-22
  • IMPACT Model – p. 24
  • Gap Analysis – p. 26-27
  • Multi-Criteria Decision Analysis (MCDA) – p. 30-32
  • Real Option Analysis – p. 33-37
  • Robust Decision Making – p. 37-38


The International Bank for Reconstruction and Development/The World Bank, (2010). Economic evaluation of climate change adaptation projects approaches for the agricultural sector and beyond. Retrieved from website:

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