Decomposition of regional and sectoral economic impacts of climate change under new scenarios

This study decomposes the heterogeneous regional and sectoral impacts of climate change using shared socio-economic pathways (SSPs) and representative concentration pathways (RCPs) scenarios. We separate value-added under the various scenario combinations into direct climate change damage costs, mitigation costs and other (indirect) value-added using a dynamic version of the evaluation model for environmental damage and adaption (EMEDA). In the decomposed EMEDA results, we find that: 1) each region has different rates of change in its direct climate change costs and mitigation costs. For example, Asia, the former Soviet Union, and the Middle East and Africa incur greater costs than the OECD and Latin America; 2) other value-added is largest in primary and tertiary industries, while mitigation costs are largest in the secondary sector; 3) the highest decomposed costs among the scenario combinations occur under the SSPs-RCP2.6 scenario.