Quantifying the Economic Impact of Climate Change and Market Dynamics: The Case of Australia’s Sydney Rock Oyster Industry

Abstract

Climate change affects fisheries and aquaculture industries due to their reliance on renewable and natural resources. The aim of this study was to develop a framework to quantify the potential economic impact of climate change on an industry and to analyze the impact of market dynamics on its economic viability under changing climate. To achieve the aim, a model was developed that incorporates economic, spatial and biophysical variables. In this study, by way of empirical illustration, the focus was on Australia’s Sydney rock oyster (SRO) industry. The findings from scenario analyses suggest that the negative effect of projected climate change on the industry’s revenue may be moderate overall. However, some production areas may be more affected than others. Furthermore, the results suggest that market dynamics could have a larger impact on the future economic sustainability of the industry than direct effects from climate change.