Adapting to Sea Level Rise and Storms

It is well known that sea level rise (SLR) will force retreat along rural coastlines but that cities will need to protect their coasts. But how exactly should seawalls, flood insurance, and retreat be used over time to minimize the overall cost of coastal flooding to society? This paper examines dynamic coastal adaptation in 5 cities along the Eastern seaboard of the United States through 2180. We argue seawalls should minimize the sum of seawall cost plus expected residual flood damage. Flood insurance for residual damage should address risk aversion. The result reveals only areas with high expected damage per km of length need walls. Only a few sections of most cities need a wall now. The optimal wall height is about 1- 2 m. SLR will force more urban seawalls to be built over the next 100 years. The faster SLR rises, the sooner they will need to be built. (JEL Q54, Q51 )