Waiting for Godot? The Case for Climate Change Adaptation and Mitigation in Small Island States

26 Pages Posted: 22 Sep 2022

See all articles by Serhan Cevik

Serhan Cevik

International Monetary Fund (IMF)

Date Written: September 1, 2022

Abstract

Global warming is the most significant threat to ecosystems and people’s health and living standards, especially in small island states in the Caribbean and elsewhere. This paper contributes to the debate by analyzing different options to scale up climate change mitigation and adaptation. In particular, the empirical analysis indicates that increasing energy efficiency and reducing the use of fossil fuel in electricity generation could lead to a significant reduction in carbon emissions, while investing in physical and financial resilience would yield long-run benefits. From a risk-reward perspective, the advantages of reducing the risks associated with climate change and the health benefits from higher environmental quality clearly outweigh the potential cost of climate change mitigation and adaptation in the short run. The additional revenue generated by environmental taxes could be used to compensate the most vulnerable households, building a multilayered safety net, and strengthening structural resilience.

Keywords: Climate change, decarbanization, energy efficiency, mitigation, adaptation, carbon tax, green financing

JEL Classification: O40, O44, Q40, Q48, Q51, Q54, Q58, H23

Suggested Citation

Cevik, Serhan, Waiting for Godot? The Case for Climate Change Adaptation and Mitigation in Small Island States (September 1, 2022). IMF Working Paper No. 2022/179, Available at SSRN: https://ssrn.com/abstract=4224067

Serhan Cevik (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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