Climate change, Atlantic storm activity and the regional socio-economic impacts on the Caribbean

Forecasting the likely economic losses arising from North Atlantic hurricanes is high on the agenda of both Caribbean and North American stakeholders. This paper develops a general equilibrium framework to conduct an impact assessment of climate change and hurricane formation. General equilibrium analysis accounts for not only primary effects but also feedback effects. The model simulations suggest that output losses occurring due to hurricanes are likely to have economy-wide effects. However, the rural economies of the region are likely to suffer the greatest (relative) effects. The findings of this study suggest that rural livelihoods should be mainstreamed in any adaptation initiatives adopted by the region. Ignoring these neighbourhood features in adaptation plans could negatively impact on poverty and unemployment in rural areas.