Sub-theme leader

Katsuhito Nohara (Rikkyo University)

Outline

An increase in the number of climate change-related natural catastrophes such as typhoons and floods is likely in the future. We will develop economic models to clarify the relationship between damage to agricultural or manufacturing products in the affected areas, the impact on manufacturing products through the supply chain network in the non-affected areas, and the impact on the macro economy. We will also consider adaptation measures by developing an economic evaluation method for disasters.

In particular, we will develop the following four models:

  1. An agricultural economic model for evaluating disasters to analyze the economic impact on the agricultural sector caused by natural disasters such as floods
  2. An economic model for evaluating disasters to analyze the economic impact on the (industry-classified) manufacturing sector caused by natural disasters such as floods
  3. A model using 47 region-interregional input-output tables at the prefecture-level in Japan to analyze the impact on agricultural and industrial products in the non-affected area through a supply chain network
  4. A macroeconomic model to analyze the impact on the macro economy from natural disasters

Developing these models will enable us to conduct simulation analyses that can estimate the impact of natural disasters caused by future climate change, per region, and on the overall economy in Japan. We will also evaluate adaptation measures against natural disasters.

Project outline

Goals

  • Developing four economic models to analyze the impact of climate change-induced natural disasters on agriculture, the manufacturing industry, and the macro economy in Japan
  • Conducting a simulation analysis that can estimate the impact of natural disasters caused by future climate change on each region and on the overall economy in Japan
  • Evaluating the adaptation measures against natural disasters.

Target items

  • The target of the agricultural economic model for evaluating natural disasters is to focus on agricultural income in each municipality. We will construct a model considering the factors that affect agricultural income, including natural disasters, and conduct a data analysis of all municipalities accumulated in the past thirty years by using econometric methods. We will clarify the impact of floods on agricultural income by estimating the parameters in our model and simulating the effect of natural disasters on agricultural income in each municipality in the future.
  • The goal of the economic model for evaluating disasters in the manufacturing industry is to focus on manufacturing sectors in each municipality. We will construct a model considering the impact of climate change-related natural disasters such as typhoons and floods on manufacturing products in the affected area and conduct a data analysis of all municipalities accumulated in the past thirty years by using econometric methods. We will clarify the impact of disasters on manufacturing products in each municipality and industry type by estimating the parameters in our model and simulating the effect on the different sectors of the manufacturing industry in each municipality by increasing the size of natural disasters in the future.
  • The objective of the model using 47 region-interregional input-output tables at the prefecture-level in Japan is to focus on overall economic activities in each prefecture, especially agricultural products, the manufacturing industry, and gross regional products. We will construct an economic model on a prefectural level considering the industrial structure. By linking this model and all prefectures, we will construct the model using 47 region-interregional input-output tables at the prefecture-level in Japan. This model will enable us to analyze the impact on non-affected areas through the supply chain network when natural disasters such as floods occur and economic damage is generated.
  • We will construct a macroeconomic model, considering the damage to the economy caused by natural disasters, and develop a model that uses a non-linear method. By applying this model, we will clarify how the shock of the disasters will affect the macro economy in the future, and what kind of financial or adaptation measures are feasible to bring the economy back to the original economic growth path.

Adaptation options

  • Flood control measure