Local Adaptation and Unintended Coastal Vulnerability

Abstract:

Feedbacks between economic decisions and geophysical processes shape the evolution of developed coastlines. Investment in protection of housing stock and infrastructure from hurricanes and natural disasters, affect patterns of coastline change and influence future economic interventions. Beyond responding to episodic disturbances, expectations of future risk and investments in maintaining natural capital alter development patterns in housing markets. (Armstrong et al. 2016; Beasley and Dundas 2018; Dundas 2017; Lazarus et al. 2018; Li et al. 2020; McNamara et al. 2015; Qiu and Gopalakrishnan 2018; Qiu et al. 2020).

In this paper, we analyze the spatial and temporal pattern of residential development in coastal neighborhoods along the North Carolina shoreline between 1992 and 2008 to causally identify the effect of storm risk and endogenous investment in local shoreline stabilization on the rate of coastal development. We focus on beach nourishment – the process of periodically rebuilding an eroding section of the beach with sand from inlets or offshore location – as it is the dominant adaptation policy along the U.S. Atlantic coast (National Research Council 2014). Our results suggest that, without nourishment, nearshore locations would have experienced a 21% lower development of new homes during our study period.

In ongoing work, we use empirical estimates to model interactions among residential development, adaptation investments, and coastal hazards. Viewed as a multi-dimensional capital accumulation problem, models of human-environmental interactions can explain patterns of coastal interventions in response to long term erosion (Smith et al. 2009). We build on previous work (Li et al. 2020; Gopalakrishnan et al. 2017; Smith et al. 2009) and develop a model that links re-nourishment decisions across towns and the endogenous evolution of housing stocks in response to nourishment.

As coastal managers continue to grapple with climate adaptation, understanding feedbacks between shoreline management and coastal development is needed to evaluate tradeoffs between capitalized benefits from beach nourishment and optimal development of coastal areas. Our analysis suggests that feedbacks in the human-natural system can make short term investments in coastal adaptation maladaptive in the long run.