Unlike incremental adaptation, which preserves the essence of existing systems or processes, transformational adaptation changes the fundamental attributes of social-ecological systems in anticipation of future climate risks.
There is an increasing interest in such change and it is a focus of the EU Adaptation Mission, however, the economic literature on this topic remains scarce. But to attract public and private resources, and to implement transformational adaptation at scale, a robust economic case will be needed.
To address this gap, ACCREU held a multidisciplinary reflexive workshop (April 2026) with around 40 stakeholders, including researchers and policymakers from a range of disciplines. The aim was to bring different actors together to debate the subject of the economics of transformational adaptation and develop a shared research agenda.
The workshop has led to two publications
1. Policy Brief – “A Future Research Agenda for the Economics of Transformational Adaptation”
A concise, policy-oriented summary presenting:
- the elements that define transformational adaptation and whether existing economic tools can address these characteristics;
- the key challenges for the economic analysis of transformational adaptation, including time preference and discounting, climate and distributive justice, decision-making under deep uncertainty, macroeconomics and financing;
- “what if adaptation needs to scale up” scenarios — and how the role of shocks, climate or socio-economic tipping points might influence greater change as well as the enablers for transformational adaptation;
- A summary of the research topics for the economics of transformational adaptation;
- a visual mapping, assessing the state-of-readiness and research priorities.
2. Deliverable D1.5 – “Research priorities and review paper on emergent co-design (of the economics of transformational adaptation)”
A longer technical report, documenting the reflexive co-creation process, the workshop methodology, a review of the subject areas, and a research agenda structured around 8 priority areas. These are:
- Defining the role of economics in transformational societal change;
- Improving the evidence base on “what works”;
- Understanding societal preferences (time and equity);
- Extending microeconomic tools (extended CBA, distributional analysis, storylines);
- Developing macroeconomic tools (CGE models, IAMs, structural change);
- Strengthening political economy, institutional and behavioural economics;
- Financing transformational adaptation and the role of the private sector;
- Opening the debate on new economic approaches for more radical climate change.
A key finding from the workshop is that economics is more than cost-benefit analysis, and that project-level appraisal is probably the wrong starting point for thinking about transformational adaptation. To address this, economic analysis needs to move upstream, with more systemic analysis of the case for action, bringing in economic disciplines that already exist, and extending beyond marginal change.