Economic and non-economic loss and damage: a harmful dichotomy?

Abstract

Abstract Non-technical summary Loss and damage is treated as comprising separate ‘economic’ and ‘non-economic’ dimensions in research and policy. While this has contributed to greater awareness and visibility of non-economic values, our empirical insights show that the two are inextricably linked and that research aimed at informing policy must be better attuned to the multifaceted and cascading nature of loss and damage. Technical summary In research and policy, climate-related loss and damage is commonly categorized as either ‘economic’ or ‘non-economic’. One clear benefit of this dichotomy is that it has raised people's awareness of the often under-discussed intangible loss and damage. However, empirical research shows that these two categories are inextricably linked. Indeed, ‘economic’ and ‘non-economic’ loss and damage often overlap, with items that are valued in monetary terms also having non-monetary significance. For example, the loss of a home due to flooding is not only a financial loss but can also have a profound impact on identity and well-being. Moreover, ‘economic’ loss and damage can cascade into ‘non-economic’ loss and damage, and vice versa. For example, when a household incurs economic losses due to drought, this may prevent their children from attending school, which has long-term financial consequences. We argue that rather than dichotomizing loss and damage, recognizing that it is multidimensional, interwoven, and evolving over time will open up new avenues for research that better reflect reality and can therefore better inform policies to address loss and damage. Social media This comment shows how economic and non-economic loss and damage are linked, which has important policy implications.

Keywords

• adaptation and mitigation
• climate change
• Earth systems (land water and atmospheric)
• human behavior
• loss and damage
• non-economic loss and damage policies
• politics and governance
• social value