Portfolio analysis as a means of managing uncertainties in climate change adaptation: Some initial reflections

Alistair Hunt, Filippo Fraschini

Research output: Contribution to journalArticle

Abstract

In order to counteract the challenge of climate uncertainties in investment planning, Portfolio Analysis (PA) aggregates diverse adaptation measures in different portfolios. Thus, instead of considering a single intervention, it attempts to identify the best portfolios according to their performance in relation to economic efficiency as well as risk (variance of the economic performance over different scenarios). However, whilst PA is recognised as having the potential for bringing about a more holistic economic analysis of adaptation, it remains rarely used. Our assessment of the key strengths and limitations of PA suggests that wider adoption of a portfolio approach will primarily depend on stakeholder recognition that by being selective about the numbers and composition of portfolios considered, data and analytical capacity constraints can be overcome.

Original languageEnglish
Pages (from-to)63-81
Number of pages19
JournalEkonomiaz
Volume97
Issue number1
Publication statusPublished - 2020

Keywords

  • Economic assessment
  • Portfolio analysis
  • Uncertainty

ASJC Scopus subject areas

  • Cultural Studies
  • Sociology and Political Science
  • Economics, Econometrics and Finance (miscellaneous)

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