Climate Change and Poverty

Climate change and therewith climate variability as well as the frequency of extreme events could slow or possibly even reverse progress that has been made regarding poverty reduction. Developing countries and especially the (rural) poor living there are suspected to suffer most from the impacts of climate change. Reasons for that are geographic and climatic conditions, dependency from natural resources, environmental systems and climate sensitive sectors as well as limited human, institutional and financial conditions. The paper examines poverty and welfare impacts of climate change on an aggregated level as well as on the microeconomic level. Impacts of climate change on the sectors economic goods and services, water, health and agricultural production are analyzed. After a case study on Mexico adaption strategies in general and in Mexico are examined and policy implications are given.