Commonly occurring natural events become natural disasters when they affect the population through death and injury, and/or through the destruction of natural and physical capital on which people rely for their livelihood and quality of life. Climate change plays a role in that it tends to increase the frequency and intensity of weatherrelated natural disasters. Additionally, climate change may put people at risk by influencing access to water, coastal flooding, disease and hunger, and leaving them with a more degraded environment, leading, in turn, to increased vulnerability. The purpose of this paper is to present a review and synthesis of the literature and case studies addressing differential impacts of climate change-related natural disasters on a society and its economy. Developed and developing countries show different vulnerabilities to natural disasters. Even within countries, impacts vary significantly across population and economic sectors. When losses from natural disasters are large, their cumulative effect can have notable macroeconomic impacts, which feed back to further pronounce existing income inequalities and lower income levels. Impacts tend to be most pronounced for women, the young and elderly, and people of ethnic or racial minorities.Readers should send their comments on this paper to: BhaskarNath@aol.com within 3 months of publication of this issue.

Climate change is increasing the intensity of extreme weather events. Mexico is particularly prone to suffer at least two different types of these events: droughts and hurricanes. This paper focuses on the effects of an extended drought on the Mexican economy. Through a computable general equilibrium model, we simulate the impact of a drought that affects primarily agriculture, livestock, forestry, and hydropower generation. We look at the effects on the overall economy. We then simulate the effects of several adaptation strategies in (chiefly) the agricultural, forestry, and power sectors, and we arrive at some tentative yet significant conclusions. We find that the effects of such an event vary substantially by sector with moderate to severe overall impacts. Furthermore, we find that adaptation policies can only effect modest changes to the economic losses to be suffered.

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Climate change alters different localities on the planet in different ways. The impact on each region depends mainly on the degree of vulnerability that natural ecosystems and human-made infrastructure have to changes in climate and extreme meteorological events, as well as on the coping and adaptation capacity towards new environmental conditions. This study assesses the current resilience of Mexico and Mexican states to such changes, as well as how this resilience will look in the future.In recent studies (Moss et al. 2000, Brenkert and Malone 2005, Malone and Brenket 2008, Ibarrarán et al. 2007, the Vulnerability-Resilience Indicators Model (VRIM) is used to integrate a set of proxy variables that determine the resilience of a region to climate change. Resilience, or the ability of a region to respond to climate variations and natural events that result from climate change, is given by its adaptation and coping capacity and its sensitivity. On the one hand, the sensitivity of a region to climate change is assessed, emphasizing its infrastructure, food security, water resources, and the health of the population and regional ecosystems. On the other hand, coping and adaptation capacity is based on the availability of human resources, economic capacity and environmental capacity. This paper presents two sets of results. First we show the application of the VRIM to determine statelevel resilience for Mexico, building the baseline that reflects the current status. The second part of the paper makes projections of resilience under socioeconomic and climate change and examines the varying sources and consequences of those changes. We used three tools to examine Mexico's resilience in the face of climate change, i.e., the baseline calculations regarding resilience indices made by the VRIM, the projected short-term rates of socioeconomic change from the Boyd-Ibarrarán computable general equilibrium model, and rates of the IPCC-SRES scenario projections from the integrated assessment MiniCAM model. This allows us to have available change rates for VRIM variables through the end of the 21 st century.

Compensating wage differentials are used to estimate marginal rates of substitution between income and both fatal and non-fatal occupational-injury risks in the Mexico City metropolitan area. Data are obtained by in-person survey of almost 600 workers and include workers' perceived risks of fatal and non-fatal occupational injury supplemented by actuarial-risk estimates from government statistics. Results using both actuarial- and perceived-risk estimates are reasonably consistent. Estimates of the value per statistical life are between 235,000 US dollars and 325,000 US dollars and estimates of the value per statistical non-fatal injury are between 3500 US dollars and 11,000 US dollars (2002 US dollars). These values are much smaller than corresponding estimates for higher-income countries but are compatible with the small number of prior estimates for lower-income countries.