by Judith Curry
How much effort should we exert this year as opposed to 10 years from now? How should we manage discontinuous or highly uncertain effects? What is the likelihood of a technological deus ex machina? Will climate change mean geopolitical surprise in the Arctic or from petroleum exporting nations? Are we a world filled with highly flexible innovators or low-turnover, high-cost capital stock? – Hultman, Hassenzahl, Rayner
Nathan Hultman, David Hassenzahl, Steve Rayner
Abstract. At their core, societal decisions about climate policy—whether emissions reductions, adaptation to climate changes, or the implementation of geoengineering—hinge on collective judgments about the extent to which adverse effects to human welfare and ecosystem services will result from changes associated with anthropogenic release of greenhouse gases and the costs associated with the emissions reductions or adaptation activities. In this article, we discuss how risk is understood in the context of climate change, which presents particularly confounding, long-term, and pervasive threats to society and ecosystems. We review theoretical approaches to risk as applied to climate change and policy responses to climate change, focusing especially on the perspectives of individuals, governments, and firms with respect to traditional decision analysis frameworks.Wealso evaluate the peculiar role of uncertainty in climate debates and how it affects decision making; the origins and nature of the various uncertainties; and how uncertainty is represented, framed, and, at times, wielded by scientists, the Intergovernmental Panel on Climate Change (IPCC), the media, politicians, and others. We conclude by assessing the limitations of and appropriate venues for risk analysis in climate decision making.
Published in Annual Reviews of Environmental Econometrics (2010) [link].
The entire article is well worth reading, here are some excerpts from a few of the sections that I find to be most insightful (bold emphasis mine):
Climate change, we might hope, would present an ideal nexus for the risk-analytic perspective as a sound basis formaking societal judgments leading to reasonable policy options. Yet in practice, the diversity of climate-related physical risks, their various inherent and reducible uncertainties, and the unequal distribution of exposure and effects across geography and time confound any simple or uncontested application of this perspective. Indeed, the mission enshrined in the 1992 UN Framework Convention on Climate Change commits the countries of the world to enact measures to avoid “dangerous anthropogenic interference with the climate system,” while infamously neglecting to outline either the process for achieving success or the metrics for assessing it.
Over the past decades, the scope of risk analysis as a discipline has expanded its focus from probabilistic assessments to accommodate the more complex tasks of informing societal risk judgments on policy questions. In the early 1960s, for example, the sudden advent of widespread concern about chemical pollutants brought to light the difficulty of aligning risk-based environmental policy recommendations under alternative value sets. Similarly, the increasingly acerbic public disagreements over nuclear power in the 1960s and 1970s fundamentally challenged the narrowly technocratic framing and understanding of probabilistic risk assessment. By the 1980s, clear distinctions emerged between more quantitative, decision-theoretic risk assessment approaches and broader risk analysis approaches that began to subsume considerations of equity, societal choice, communication, perception, and other nonquantitative dimensions.
By the 1990s, viewing societal challenges through a lens of risk had become common among academics from a range of disciplines, as an organizing theme for interdisciplinary explorations and as an instrument of and justification for public policy. During each of these phases, new environmental challenges created tensions in how risk was understood and deployed in public policy arenas. These tensions often stimulated, and continue to stimulate, new work in the field, derived from new challenges including emerging diseases, nanotechnology, and terrorism. Accommodating novel characteristics of the most prominent of these arenas—climate change— necessitates sweeping modification of the scope, methods, and values basis of risk analysis.
Climate Risk and the Policy Discourse
[D]ifferent people and groups will often disagree about the degree of uncertainty or even the decision stakes. Is climate change a well-understood technical problem supported by reliable data or is it a speculative threat based on contentious models? Are the consequences of climate change or policies designed to prevent it limited to a few percentage points of global gross domestic product that pale in comparison to the losses incurred in the financial crisis of 2008, or are they likely to be truly catastrophic? The traditional engineering and health approach, the inevitable corollary of defining anything as presenting a risk, indicates that climate change can and ought to be rationally managed, or at the very least contained, and preferably eliminated. In some cases with both high systemic uncertainty and high decision stakes, application of risk analysis tools can be a way of politically asserting the manageability of whatever is seen as its source. The issue in those cases becomes misconstrued as a problem for calculative rationality, rather than one for deliberative discussion.
An additional limitation is that the application of any one of these approaches is also influenced by human perceptions of risk, which are often inconsistent and far from objective. For example, in response to questions about nuclear risk, psychologists described how dread, familiarity, and exposure seem to be just as important to risk evaluations as probability or magnitude. Of particular relevance to climate, other researchers noted how the recent occurrence of infrequent events would highlight public concern that they would be repeated and that disparate perceptions of low probability events pose challenges for policy. However, there remains a privileged position for expert assessments of the “real” risks when nonexpert individuals are described as loss averse or loss accepting, probability over- or underestimating and tending to prefer large uncertain losses to small certain ones.
Similarly, different decision makers operate with particular contrasting views of the vulnerability of nature and the economy. Those who see nature as endangered by climate change often view climate policy measures, especially greenhouse gas mitigation policies, as relatively inexpensive to the economy—and possibly even as beneficial through the stimulation of new “green” industries; such perspectives view economic systems as more resilient than the natural world. Others view the economy as more vulnerable to perturbation, while nature is assumed to be resilient and normally in a state of transformation and flux. A third view sees both nature and the economy as resilient, but only within limits that must not be breached, a perspective that tends to use tools of risk assessment to understand the relative dangers of alternate approaches. To the advocates of radical climate policy, such analyses may be dismissed as delaying tactics, whereas those who are convinced that the costs of climate policies are unnecessary and prohibitive may welcome them for the same reason.
Assessment and Conclusion
The broad spectrum of problems associated with anthropogenic climate change, however, also increases the potential for overbroad or inattentive application of risk analysis. Indeed, much like debates about sound science, the deployment of risk can quickly become enmeshed in politics. Those who claim to speak rationally about future risks can hold power in the public sphere that can be, through honest mistake or deliberate obfuscation, disproportionate to the certainty behind such pronouncements. In areas of contested politics and areas of great economic stakes, an analytic risk lens can be leveraged to political ends.
In particular, we should recall that risk analysis can at best differentiate between estimated and perceived risk, not between actual and perceived risk. However, in cases where the outcomes are highly contested or based on value judgments that are not widely agreed upon, we can expect analytic risk frameworks to lead unfortunately to results whose impartiality is disputed and that are of use only to those groups that agree with their premises.
Unfortunately, in these contexts, the mantle of climate risk analysis can easily slip, either deliberately or not, from careful application of a well-developed method to a loosely supported deployment intended to bolster politically driven positions. The challenges we face are to know where best to draw the line between the tactical and strategic and to leave the strategic and value judgments more fully to the necessary and healthy steps of political discourse. A productive approach would be to strive to articulate clearly the values and uncertainties associated with risk studies not only in academic publications but also when communicating climate risk to decision makers, the media, and all other audiences.
JC comments: This article provides some substantial insights about the policy and political debates surrounding climate change. The paper also includes some very interesting discussions on the types and roles of uncertainty in risk analysis. I look forward to your comments.