Climate Change as One Big Infrastructure Project

From economist Matthew Kahn:

"The NY Times repeats over and over again that we will lose Miami.  I doubt this but suppose it is true. As the water rises, people will leave and they will strip down the capital from the existing structures.   Such rational individuals will seek out higher ground and rebuild there. In this sense, climate change is a "Keynesian" stimulus creating new construction jobs as new housing is built in safer areas.  Real estate prices will rise in those safer areas.  Non-economists always ignore this general equilibrium effect as they focus on the losses to the Miami land owners.  In my vision of our future, the coastal people escape but the coastal land owners lose while inland land owners gain.  Will we lose our productivity by this scrambling to higher ground?  No,  human capital agglomeration is the key to growth. If Wall Street sinks, then the bankers will regroup on higher ground in Connecticut.  This is the urban economics of climate change adaptation.  Welcome to my research."