Methods and Tools - IPCC TAR WGII (Chapter 2) Gary Yohe Professor of Economics Wesleyan University June 11, 2001

QUESTIONS RAISED IN THE CHAPTER Detecting the current effects of climate change (and climate variability) Anticipating, estimating, and integrating future effects of climate change (and climate variability) Valuing and costing impacts and adaptations Expressing and characterizing uncertainties Reflecting appropriate frameworks for decision-making.

The Vulnerability Context of Adaptive Capacity Vulnerability (a vector V) is a function of exposure (to multiple stresses - a vector E), sensitivity (a similarly dimensioned vector S), and adaptive capacity (A); so: V = F{ E(A); S(A) } Adaptive capacity may be quantified to a scalor, but it has multiple determinants D i : A = AC {D 1, ……, D 8 }

The Determinants of Adaptive Capacity Range of adaptation options Availability and distribution of resources Structure of institutions and decision-making processes Stock and distribution of human capital Stock of social capital Access to risk spreading processes and mechanisms Ability to process information and the credibility of decisions Public perception of exposure, sensitivity and attribution

Site Specificity and Path Dependence - The Scale of Determinants Applicable options are determined on a micro scale, but the list of possibilities may come from macro-scale processes like this one The next 5 determinants have macro-scale roots, but micro-scale manifestations: Resources and their distribution Institutional structure; decision-making Human capital Social capital Access to risk spreading

Scale Considerations, Continued Information management may have macro-scale foundations, but it has fundamental micro-scale import. Public perception of attribution should similarly be determined on a micro-scale even if there are influences from outside and potential sources of information have a macro scale. The issue is credibility and when micro-scale actors look for credible information.

Implications for the Adaptation Methods and the Policy Framework The local implications of macro-scale determinants are their most important characteristics, and working the links across scales can add clout by expanding the scope of influence. The effects of most if not all of the determinants of adaptive capacity can be traced through their implications for specific adaptation options. Assessing overall vulnerability through organized and determinant-based considerations of the abilities of available options to influence sensitivity or exposure could be a very effective foundation for a methods and policy frameworks.

Adaptation Options and Coping Capacity The critical link in each context can be the definition of thresholds that define the boundaries of coping capacity against variability in the local environment. It follows that exploring how each option might be able to change those thresholds or variability to influence exposure and/or sensitivity is critical. The roles of other determinants in impeding or enhancing those abilities must also be recognized. And systematic interactions across determinants and adaptation options cannot be ignored.

Returning to the Questions Detection informs our understanding about exposure and sensitivity. Anticipation, estimation and integration of future effects does the same: Anticipation takes detection into the future to identify stresses. Estimation adds detail to characterizations of the future. Integration brings the interactions of multiple stresses into focus.

Integrating Multiple Stresses Some stresses have common sources - another place where macro scale processes can be identified and exploited. Other stresses have different sources, but are they positively or negatively correlated? Or are they independent? Looking endogenously for anthropogenic sources can highlight new suites of adaptive options.

More on the questions Valuation and costing impacts and adaptations play into evaluations of options, but currency is not necessarily the only metric: Schneider’s 5 metrics: monetary loss, human life quality of life, loss of species and bioversity, and (in)equity and the distribution of well-being; and both can play a role in assessing the significance of resource availability and their distribution.

More on the questions Uncertainty plays a role in: Institutions - how do they cope with uncertainty? The significance and structure of risk spreading mechanisms. Decision-makers and public perception - how do the players sort the signal from the noise?

Uncertainty and Coping Capacity Looking at climate variability provides “early warning” to “not-implausible futures” and abrupt impacts of climate change. Focusing on the ability of adaptation options to manipulate the coping capacity as well as variability offers a way to include uncertainty into the analysis. This is the link that brings short-term planning horizons into the context of long-term stresses like climate change.

Uncertainty and Analysts Notwithstanding our considerable abilities, the output of the impact and adaptation analysis and/or a Policy Framework must be cast in terms of underlying uncertainty: Ranges of possible outputs. Representations of multiple moments. Consideration of robustness in assessment and adaptation.

More on the questions Understanding of decision analytic frameworks and their local, path dependent application informs our understanding of: Institutions Human and social capital Positive and normative analysis of risk spreading mechanisms

Topic Organization of Chapter 2 Detection (species and managed systems) Anticipating change Integrated assessment Cost and valuation methods Representing uncertainty Decision-analytic frameworks

Questions versus Sections in Chapter 2

Topics: Detection There are two questions of attribution: Anthropogenic forces are changing the climate Climate change is have an impact Fingerprint argument based on global congruence - a basis of considerable controversy. Still, for present purposes, the second attribution critical for framing adaptation. Nonetheless, the first attribution important in evaluating future.

Anticipating Future Impacts Scenarios define baselines and define scales. This is perhaps backwards for adaptation work. Integration in Chapter 2 tends to focus on feedbacks and the role that vulnerability pays in pushing mitigation. This is not the type of integration needed here. Attention is nonetheless drawn to climate variability and extremes. Exactly, and the link to adaptive capacity made. Focus attention on variability, thresholds, coping capacity and abrupt impacts of climate change.

Integrated Assessment Integrated assessment broadly defined is not necessarily linear from beginning to end. IA methods can help with multiple stresses (their common sources and/or diversity) interactions of adaptation options delineating the operative scales of determinants the definition of location specifics and path dependence.

Cost and valuation methods All concepts are based on the notion of opportunity cost. This foundation can accommodate multiple metrics. Costing methods can provide some answers and insights, but not all; e.g., the cost and sources of inequity. Other initiatives on quantifying monetary estimates of non- market impacts (through direct and indirect methods) may not be widely applicable. This means that cost-benefit analysis is not the only game in town. Ultimately, though, there needs to be some assessment of tradeoffs across values attached to specific metrics….

This is the ultimate context for opportunity cost.

Uncertainty Sources of Uncertainty: Missing data or errors in data and noise. Random sampling error and/or selection bias. Known processes with unknown functional forms. Known structures but unknown parameters. Structural change over time. Ambiguous concepts or techniques. Spatial or temporal scale mismatches. Humans.

Cascading Uncertainty This is a widely accepted notion that integration across multiple systems amplifies uncertainty. Adaptation based analysis from second attribution short- circuits some of the cascade……as long as adaptive capacity analyses consider the robustness of that capacity and the derivative vulnerability across a range of “not- implausible” scenarios regardless of attributed probabilities (these may not be known; and the tails might be wide).

Decision Analytic Frameworks Highlights formal distinctions between: Cost-benefit criteria. Precautionary criteria. Broad-based decision analysis. Risk analysis. Cost-effectiveness. Policy exercises. Adaptive capacity focus suggests that local specificity and path dependence determine the DAG

Take-Home Messages Multiple tools exist, but they may not be fully adept at handling adaptation/impacts analysis. While macro-scale processes work in most if not all parts of the world, micro-scale processes are critical; and they may not fit any specific context. Nonetheless, there will be common insights, common frustrations, and common methodology.

Let many flowers bloom, and convene periodically to compare notes, share “war stories”, and otherwise collaborate without the requirement of producing a “comprehensive document.