The frequency and severity of extreme events related to climate change have intensified worldwide in the last decades. It is documented that increasing extreme rainfall and flooding cause more nutrient runoff into waterbodies initiating numerous harmful algal bloom (HAB) events. We analyze the dramatic economic damage of one of these episodes in Mar Menor, the largest salt-water lagoon in Europe. We show that, when the public perceived the severity of environmental degradation, the return on housing investment was 43% lower in this area than in similar neighboring zones six years after the HAB (2015). This represents a loss in housing wealth of more than 4,000 million euros, around ten times the gains of changing from dry-farming to irrigated crops, which makes this ecosystem fragile. Hence, we quantify some of the economic consequences of ecological deterioration linked to Global Climate Change, a macro critical risk affecting the world economy.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.