An impact analysis of the impact of climate change and adaptation policies on the forestry sector in Quebec. A dyanamic macro-micro framework

Quebec’s forests represent 20% of the Canadian forest and 2% of world forests. They play a major role for habitat preservation, supplying goods and services to the population and hence contribute to the economy of this Canadian province. Climate change will have an impact of the forest through increased droughts, warmer summers and winters or infestations such as the pine beetle (British Columbia and New Jersey). Two adaptation policies are simulated to be implemented to help the sector cope with CC direct and indirect effects. In our study we analyze the impact of CC on the forest industry in Quebec and on its economy. We also simulate two adaptation programs jointly with impact of CC of forestry. Our analysis is performed over a 40 year time span with a recursive dynamic CGE-micro-simulation framework allowing for distributional impact analysis. The impact of CC on the forestry sector are relatively small the secondary transformation industries support only a portion of the cost. Adaptation policies are efficient in reducing the negative economic and distributioinal impact.